Canceling Insurance Policy Doesn’t Revoke Consent

TCPA Connect

Canceling an insurance policy alone was insufficient to revoke the consent of a married couple to receive calls from their former insurance company, an Indiana federal court recently ruled.

To obtain health insurance coverage, Melissa and Benjamin Wilkes applied for coverage under the Affordable Care Act (ACA) through an online health insurance marketplace. In their online application, the Wilkes couple provided Melissa’s cellphone number. The website contained a disclosure that an applicant’s information may be shared with the insurance companies that issue plans.

When consumers select a plan and submit an application to the marketplace, their information is reduced to an extract file, which is then transmitted to the insurance provider, who is then bound to provide coverage. The Wilkes couple received coverage from Caresource in 2015.

In August 2015, the Wilkeses’ fourth child was born and they sought to add him to their insurance coverage. Melissa called and spoke with Caresource representatives, providing both her cellphone number and her husband’s number.

The Wilkes family made their final premium payment in November 2015, but as mandated by the ACA, the policy automatically renewed for the 2016 calendar year. On January 28, 2016, Melissa called Caresource requesting that the Wilkeses’ enrollment be terminated. The insurance company directed her to instead terminate coverage through the marketplace, which she did.

As in the application process, the termination of coverage information was provided to the insurance company through an extract file, which Caresource received on February 12, 2016.

Well after the family’s coverage had ended, a third party that contracted with Caresource to make automated “welcome calls” called Melissa’s cellphone five times. The calls—intended to share information with Indiana marketplace members regarding their healthcare benefits and assist them in accessing healthcare providers and wellness programs—were made between April 14 and April 27, 2016.

Melissa called Caresource to complain, and a representative placed her on a do-not-call list. Although the Wilkes couple received no more calls, they filed a TCPA lawsuit against the insurer and the third-party caller in Indiana federal court.

Caresource moved for summary judgment, arguing that it had prior express consent to call Melissa’s cellphone and that this consent was never revoked. The Wilkeses countered that their cancellation equaled revocation of their consent to be contacted by the insurance company.

Granting the defendant’s motion, U.S. District Judge Joseph S. Van Bokkelen first held Caresource had prior express consent to call Melissa’s cellphone.

“Plaintiffs gave Defendants express consent to be called,” the court said. “They provided Melissa’s cell phone number as part of their application for insurance, which was then transmitted to Defendants via the extract file. Further, while the welcome calls were made to Plaintiffs mistakenly after they had ended their coverage and did not apply to them, the content of those messages—health care benefits, providers and wellness programs—were reasonably related to the insurance coverage for which Plaintiffs originally provided their cellphone number.”

Did the plaintiffs revoke their consent when they canceled their policy? No, Judge Van Bokkelen ruled, relying on the U.S. Court of Appeals, Ninth Circuit’s decision in Van Patten v. Vertical Fitness Group.

In Van Patten, the federal appellate panel considered whether the plaintiff—who gave his phone number in 2009 to a Gold’s Gym franchise in Wisconsin when he joined the gym, only to quit three days later—provided prior express consent to receive two text messages three years later about re-joining a different franchise.

The Ninth Circuit held that Van Patten had given his prior express consent to receive the texts and explained that the cancellation of a gym membership did not sufficiently communicate “a desire to no longer be contacted,” as “[r]evocation of consent must be clearly made and express a desire not to be called or texted.”

Applying this principle, the Indiana court ruled that the Wilkeses did not revoke consent by canceling their policy.

“[S]imply canceling insurance coverage on February 12, 2016, through the Marketplace was not sufficient to revoke consent to be called under the TCPA,” Judge Bokkelen wrote. “The welcome calls that were made to her cell phone between April 16 and April 27, 2016, were, therefore, not in violation of the TCPA. On the other hand, Melissa plainly and unequivocally told Defendants she no longer wished to receive calls on April 27, 2016. This was effective revocation of her consent to be called, which the Defendants honored. Accordingly, Defendants are entitled to summary judgment.”

To read the opinion and order in Wilkes v. Caresource Management Group Co., click here.

Why it matters: While a call recipient may revoke consent by any reasonable means, according to at least one Indiana federal court, terminating the business relationship alone does not suffice. In a win for defendants, the Indiana federal court held that a person who consents to be called must affirmatively revoke that consent, that consent to be called survives the termination of the business relationship, and that a revocation of consent to be called cannot be implied by the termination of that relationship. Finding the Ninth Circuit decision in Van Patten instructive, the Indiana court concluded that the act of canceling an insurance policy did not also revoke the plaintiffs’ prior express consent to be contacted by their former insurance company. However, it is still a best practice to avoid sending unwanted texts, as this lawsuit could have been avoided entirely, had the company simply scrubbed its phone lists against those who were no longer enrolled prior to sending out its “welcome” texts.