Active&Fit Enrollees in Calif. Were Charged Gym Membership Fees Despite COVID-19 Closures, Class Action Alleges

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A proposed class action claims a handful of California health insurance and healthcare providers fraudulently continued to charge members for access to certain fitness centers, even when the consumers were unable to use the facilities due to COVID-19 lockdown orders.

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The 17-page lawsuit says that Blue Cross of California and subsidiary Anthem Blue Cross Life and Health Insurance Company represented that insureds, as part of the Active&Fit Direct program, would receive discounted gym membership benefits at over 11,000 participating fitness centers nationwide.

The case alleges, however, that when COVID-19 lockdown orders barred access to gyms and participating fitness centers stopped charging the defendants for services, the companies—along with American Specialty Health Incorporated and subsidiary American Specialty Health Fitness, Inc.—continued to collect program membership fees from insureds anyway.

According to the case, Active&Fit Direct program members sent their $25 enrollment and $25 monthly membership fees directly to American Specialty, which, in turn, paid participating gyms for access. Per the complaint, the defendants represented that members would be able to access participating fitness centers “without disruption” as long as the consumers remained a part of the Active&Fit Direct program.

However, the filing contests that the companies, in a “remarkable showing of bad faith,” continued to collect money from consumers during the COVID-19 lockdowns as if the defendants were still being charged by participating gyms when, in fact, they were not.

As the lawsuit tells it, after lockdown orders enforced gym closures in California, the defendants failed to mention to program members that they would continue to be charged for discounted gym memberships—even though they were unable to access the gyms—and did not provide any compensation or reimbursement for the lack of services, for which consumers had already paid.

The suit argues that, instead, the defendants “conspired” together to “maintain the façade” that fitness centers were still charging American Specialty, thereby “justifying the continued debiting of program members’ accounts on a monthly basis for the ostensible, but nonetheless illusory benefit of gym membership.”

“While the fitness centers appear to have acted honorably by not charging for services that they were not providing,” the case scathes, “the [defendants] did not.”

The plaintiff, a California resident, paid a $50 setup fee to join the Active&Fit Direct program in June 2019, the complaint says. In mid-March 2020, the man received a notice that his gym, LA Fitness, would be closing temporarily due to the pandemic, the filing explains.

Though fitness centers like the plaintiff’s LA Fitness were closed for approximately a year, the defendants continued to improperly charge consumers $25 a month for services that the companies did not provide, the case alleges.

The lawsuit looks to represent any individuals or entities that enrolled with American Specialty to participate in its Active&Fit Direct program in California at any time since April 7, 2019, including those who were insureds or dependents of insureds of Blue Cross of California and/or Anthem Blue Cross Life and Health Insurance Company.

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