The Federal Trade Commission (FTC) has obtained a temporary restraining order (TRO) in the Southern District of Florida against Top Healthcare Options Insurance Agency Inc. and 11 related defendants, shutting down an alleged nationwide telemarketing scheme that marketed limited‑benefit plans and discount memberships as if they were comprehensive, Affordable Care Act–style health insurance.
According to the Complaint, the defendants funneled consumers from misleading lead‑generation websites into high‑pressure sales calls during which telemarketers allegedly misrepresented the nature, scope, and cost of coverage, causing “tens of millions of dollars” in harm and leaving consumers exposed to substantial, unexpected medical bills.
From a compliance perspective, the case is a direct continuation of the FTC’s aggressive focus on “sham health insurance” and deceptive health‑plan telemarketing, following the 2024 Simple Health Plans judgment and the 2025 Assurance IQ / MediaAlpha actions. It is also another clear signal that the FTC is prepared to use the Telemarketing Sales Rule (TSR) against health‑plan marketers, notwithstanding the “business of insurance” carve‑out, whenever it deems telemarketing or lead‑generation conduct is not adequately constrained by state law.
Compliance officers supporting health‑plan lead generation, brokerage, and telemarketing should treat this case as a roadmap for what not to do—and as a checklist for tightening TSR, UDAP, and TCPA‑adjacent controls.
The Defendants and the Alleged Scheme
The Complaint names 12 defendants: six insurance agencies/related sellers, two marketing entities, one media/financial entity, and three individuals, which the FTC characterizes as a “web of companies and individuals” operating a coordinated telemarketing enterprise around misleading health‑plan offers.
The FTC’s allegations place the lead‑generation ecosystem at the heart of the scheme. Consumers did not start with the defendants. Instead, they started online when searching
for “comprehensive health insurance” and were directed to websites branded with terms like
“Affordable Care Act Plans,” “Obamacare Health Insurance Carriers,” and “2024 Obama Care Plans.” The websites touting these plans appeared to offer legitimate ACA or marketplace‑type coverage but, according to the FTC, were in fact lead‑generation pages designed to collect consumer data and resell it to the defendants or their vendors.
This model is consistent with the broader health‑insurance lead‑gen ecosystem the FTC took action against in FTC v. Assurance IQ and MediaAlpha—where third‑party lead sources and aggregators funneled traffic to telemarketing centers that then pitched non‑comprehensive products as if they provided robust coverage.
Once a consumer’s data is captured and sold, telemarketers allegedly call the consumer and execute a script designed to “move prospective buyers away from comprehensive health insurance coverage and toward the plans they offer.”
The products at issue were not comprehensive major‑medical policies, but rather limited‑benefit plans (e.g., fixed indemnity or restricted coverage products) or medical discount memberships. According to the FTC, however, the pitch endorsed by the defendants expressly or implicitly represents these products as comprehensive health insurance or its equivalent. Consumers were led to believe that the plans on offer provided substantial coverage tailored to their needs that limited their financial responsibility for certain services to a fixed, low amount through copays or deductibles.
The Complaint alleges that these claims are materially false or misleading, and that consumers were left exposed to thousands of dollars in out‑of‑pocket medical expenses when they attempted to use the plans. This tracks the fact patterns in earlier actions such as Simple Health Plans and Assurance IQ, where consumers believed they had “real insurance” but discovered—often only after serious health events—that they held only discount programs or tightly capped indemnity products.
FTC Act Violations
The Complaint alleges that the defendants’ conduct violates Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices in or affecting commerce. Key deceptive elements, as framed in the press release, include:
- Misrepresenting limited‑benefit plans and discount memberships as comprehensive health insurance or equivalent coverage.
- Misrepresenting that plans are PPO products with robust network access.
- Misrepresenting that the plans provide “substantial coverage” for the consumer’s particular providers, needed services, or prescription drugs.
- Misrepresenting that consumers’ costs would be capped at low copay or deductible levels.
Under standard FTC deception analysis, these allegations map cleanly onto the classic three‑part test: (1) A representation, omission, or practice; (2) That is likely to mislead consumers acting reasonably under the circumstances; (3) where the representation or omission is material.
Positioning limited‑benefit or discount products as comprehensive insurance is almost paradigmatically material, given the centrality of coverage scope and cost‑sharing terms to a consumer’s health‑plan selection. Prior FTC reporting and litigation in this space (e.g., Simple Health and the Assurance IQ order) have already made clear that overstating coverage for preexisting conditions, misrepresenting benefit caps, and suggesting out‑of‑pocket exposure is limited when it is not are all quintessential Section 5 violations.
Telemarketing Sales Rule (TSR) Violations
The FTC also alleges violations of the Telemarketing Sales Rule (16 C.F.R. Part 310), which prohibits misrepresentations about any material aspect of the performance, efficacy, nature, or central characteristics of goods or services, as well as total costs and material conditions of the transaction. The TSR also imposes separate restrictions on unauthorized billing and mandates express informed consent for certain payment methods.
The FTC’s telemarketing‑specific allegations align with these core TSR prohibitions. The defendants allegedly made false claims about the nature of the product (comprehensive health insurance vs. limited‑benefit/discount products) and the consumer’s out‑of‑pocket exposure via purported low copays and deductibles.
Because these representations go directly to product identity, extent of coverage, and the consumer’s financial risk, they are squarely “material” under the TSR’s misrepresentation provisions.
The Temporary Restraining Order
The FTC obtained a temporary restraining order (TRO) from the U.S. District Court for the Southern District of Florida, halting the defendants’ operations pending further proceedings. The TRO indicates that the court found a prima facieshowing of likely violations and a need for interim relief to protect consumers and preserve assets. Although the FTC’s public materials do not detail the full TRO terms, in health‑plan telemarketing cases of this type, TROs typically include some combination of a prohibition on further marketing of the challenged products, together with an asset freeze to preserve funds for potential consumer redress.
While specific terms here must be confirmed from the actual order, the public statement that the court has “temporarily stopped the operations” signals substantial operational restraints.
Complaint for Permanent Injunction, Monetary Judgment, and Other Relief
In addition to the TRO, the underlying Complaint also seeks a permanent injunction, monetary relief in the form of refunds/redress for affected consumers, and other equitable or structural relief, potentially including bans on certain forms of telemarketing or health‑plan marketing.
It is reasonable to expect that if the FTC prevails on the merits in this case, the final order will impose stringent telemarketing and health‑insurance marketing restrictions on both corporate and individual defendants, consistent with this pattern.
The Clear Lesson for Health Plan Marketers
The FTC’s action against Top Healthcare Options represents another major step in a sustained campaign against deceptive health‑plan telemarketing and sham coverage arrangements. By combining the FTC Act’s broad deception authority with the TSR’s specific misrepresentation and consent provisions, the Commission continues to reshape expectations for how health‑related products can be marketed over the phone
For health‑plan marketers, brokers, and lead generators, the case crystallizes a set of non‑negotiables:
- Do not sell limited‑benefit or discount products as if they are comprehensive, ACA‑style coverage.
- Ensure every telemarketing statement about coverage, networks, caps, and cost‑sharing is fully accurate and substantiated.
- Treat lead‑generation assets and partners as core compliance risks, not just top‑of‑funnel volume drivers.
- Assume the TSR applies and build a mature telemarketing compliance program accordingly.
Given the trajectory from Simple Health to Assurance IQ/MediaAlpha and now Top Healthcare Options, entities in this space should expect continued, and likely escalating, enforcement. Early, proactive remediation of lead‑gen practices, scripts, and vendor relationships is far less costly than defending against a TRO and a demand for tens of millions in consumer redress.
