Following up on an emergency cease and desist order issued last month, Maine regulators are prohibiting a Tennessee company and its operators from continuing activity in the state and have ordered the firm to pay of $1.2 million in civil penalties.

Mila Kofman

Maine Insurance Superintendent Mila Kofman issued the final cease and desist order May 17 against American Trade Association (ATA), a provider of health plans sanctioned in several states and ordered into liquidation by a Tennessee judge. In addition to ending its “illegal activities,” Kofman ordered the company to pay outstanding medical bills and premium refunds.

“Health insurance scams are on the rise,” Kofman said in a statement. “The reality is that they provide no real insurance coverage. This is one of many scams that have spread around the country. Consumers must protect themselves or be stuck with unpaid medical bills after having paid premiums.”

ATA and its subsidiaries, including Smart Data Solutions, have collected more than $22 million in premiums nationwide, according to Koffman’s office. Last month, a Tennessee court discovered that $7 million in medical claims are owed by the companies with only $2.1 million in assets accounted for.

Several states, most recently South Carolina, have issued cease and desist orders against ATA and its affiliated companies for issues including selling unlicensed products, unlicensed agents and not adequately paying medical bills.

“We will work with Tennessee to help ensure that Maine’s consumers and providers receive their fair portion from any available assets to help pay for outstanding medical bills,” Kofman said.