Don't Confuse Medical Discount Plans With Health Insurance

If you don’t have health insurance, you might hear about a medical discount plan and think that it’s an affordable alternative, but be careful. Some of the plans being sold don’t lower your health care costs at all, and in some cases can even increase them. That’s why the the FTC and 24 states have recently filed a total of 54 lawsuits against companies selling medical discount plans to people who don’t have health insurance.

The FTC cited three examples of what can go wrong with these discount plans:

A company called the Consumer Health Benefits Association (CHBA) “targeted consumers who sought information on the Internet about major medical health insurance plans,” promised savings of up to 85% and said the plan was widely accepted. In reality, customers found that caregivers on the approved list refused to accept the plan, and some prescription drug prices were actually higher than if they had been purchased outright.

Health Care One LLC misled consumers that it was affiliated with the federal government. It promised the same benefits as the CHBA plan and came with the same faulty results. It also came with a “100% satisfaction” refund guarantee that didn’t work, and those who managed to get refunds were subject to a steep “processing fee.”

United States Benefits LLC presented itself as actual health insurance; it was only after purchasing the plan that consumers learned that it was actually a discount plan membership “consisting of healthcare-related discounts with little or no value.”

“FTC, State Attorneys General, Insurance Commissioners Crack Down on Bogus “Medical Discount Plans” Peddled to the Uninsured, Uninsurable, and Unemployed” [FTC] (Thanks to Nicole!)