On July 14, 2025, the operators of telemedicine company Southern Health Solutions, Inc., doing business as Next Medical and NextMed, agreed to settle the Federal Trade Commission's (FTC) charges that the company's weight‑loss membership program employed false pricing, misleading weight‑loss claims, and fake testimonials to promote access to GLP‑1 medications such as Wegovy® and Ozempic®. The three current Commissioners1 voted unanimously to issue the administrative complaint and to accept the proposed consent agreement.
Key allegations include:
- Hidden fees and deceptive pricing: Ads promoted membership such as "only $79 for your first month," failing to disclose the cost of medication, labs, mandatory membership terms, and early-termination fees.
- Fake reviews and suppressed negative feedback: Tactics involved fake before-and-after photos, testimonials from non‑customers, manipulating Trustpilot via incentivized positive reviews, and suppressing negative reviews.
- Unsubstantiated weight‑loss claims: Marketing, according to the FTC, claimed an average weight loss of 53 pounds (23% of body weight), without substantiation.
- Customer service failures: The company thwarted cancellation and refund requests, failing to process them adequately despite a one‑year commitment.
Under the proposed order, NextMed and its principals must pay US$150,000, which is expected to be used to provide refunds to consumers. NextMed and its principals are also subject to future injunctions against similar deceptive conduct.
Contextualizing Within FTC's Broader Enforcement Priorities
Under Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45) (FTC Act), the FTC has broad authority to protect consumers from unfair or deceptive acts or practices. Historically, enforcement in the context of health care marketing claims was mostly limited to dietary supplements. But all of that changed in recent years, during which the FTC has revealed an expanding strategy to regulate a wide range of health-related marketing claims, including but not limited to those made in the context of foods, over-the-counter (OTC) drugs, homeopathic products, health equipment, diagnostic tests, and health-related apps. Rooted in the FTC's 2022 Health Products Compliance Guidance, health-related marketing claims seem to have emerged as a top enforcement priority for the agency under its current leadership2. Moreover, FTC has taken pains to distinguish its requirements for marketers from those of FDA, making clear that while the two agencies share jurisdiction and work together closely, compliance with FDA notification and disclosure requirements will not necessarily cure an otherwise deceptive ad.
In addition to showing FTC's continued focus on health care marketing claims, the NextMed action indicates that FTC also continues to scrutinize deceptive testimonials, fake or manipulated consumer reviews, inadequate disclosure of material connections, and unfair recurring charges and "negative option" programs.
Key Legal Takeaways for Health Care and Telemedicine Businesses
1. Consumer Reviews and Testimonials Must Comply with Endorsement & Testimonial Guides
When advertising their services, telehealth businesses must ensure, among other things, that consumer reviews are legitimate, not manipulated or "cherry picked," and based on honest, representative feedback from actual users under normal, real-world conditions. Similarly, testimonials and endorsements must be based on personal experience from actual users of the product or service under normal circumstances, any claims embedded within the testimonials should be substantiated, and any material connection between the consumer/endorser and the business must be clearly and conspicuously disclosed.
2. Recurring Charges Require Clear, Itemized Disclosure
The NextMed action highlights the FTC's growing scrutiny of health care entities and especially those companies that bundle services into "membership" models. Providers — whether offering GLP-1 programs or gender affirming care (GAC) — should practice proactive compliance by:
- Fully disclosing pricing and terms.
- Itemizing all costs — including provider consults, medications (e.g., GLP‑1s), lab work, and shipping — rather than advertising a single low monthly price that conceals the full financial commitment.
- Avoiding vague language like "from $X/month" pricing where critical components (like drug access) are either not included or vary dramatically.
3. Negative Option Practices Must Comply With FTC Requirements
NextMed allegedly made it hard for consumers to cancel — charging for full-year commitments and obstructing refunds. These practices by NextMed violated the FTC's Negative Option Rule, which applies to auto-renewing memberships or "free trial to paid" structures. Under the rule, businesses must:
- Clearly disclose all terms before enrollment, including renewal timing and billing frequency;
- Obtain express, informed consent for recurring charges; and
- Provide a simple mechanism to cancel, equal in ease to the sign-up process.
FTC enforcement in this area is increasing. Providers using recurring charges must ensure that pricing, consent, and cancellation practices align with the FTC's updated Negative Option Rule, or risk enforcement actions that can involve both federal and state regulators.
4. Federal and State Fraud & Abuse Laws May Apply to Membership Models
While the FTC's action is rooted in consumer protection law, these payment models may raise risks under:
- The Federal Anti-Kickback Statute (AKS) if payments for referrals or drugs are disguised within bundled or recurring fees, especially where remuneration flows to or from practitioners.
- State fee-splitting prohibitions, which restrict licensed providers from sharing fees with unlicensed entities in ways that might incentivize overutilization or interfere with independent medical judgment.
Membership models must be carefully structured to avoid the appearance of improper inducements, referral arrangements, or volume-based remuneration.
Conclusion
The NextMed settlement is yet another enforcement action signaling the FTC's intensifying yet consistent approach: policing misleading health care marketing across diverse services. As the FTC applies its core principles to telehealth and other health care marketers, all stakeholders —whether provider, health care systems, or payor platform — must adopt robust compliance frameworks to manage emerging risk.
Footnotes
1. The FTC is designed to have five total Commissioners, with no more than three from a single political party. After taking office in 2025, however, President Trump removed the two Democratic Commissioners then serving, Alvaro Bedoya and Rebecca Kelly Slaughter.
2. On July 9, 2025, the FTC held a workshop to examine whether the marketing of gender-affirming care (GAC) services for minors may involve deceptive claims or unlawful omissions of risk.
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