Educational Consumer Tips

Discount Medical Plans

Author: Better Business Bureau

With the rising cost of health care and prescription drugs, consumers
are looking to discount plans for relief. Many of these discount
plans claim to offer savings on prescription drugs, doctor and dental
visits, vision care or other medical services. Advertisements - often
found on the Internet, through infomercials or in "spam" email - boast
that consumers can save up to 30 percent or more on the cost for
such services. Generally, the plans indicate there is a network of
providers who will discount their charges for plan members.

Consumers who are confused by these plans often believe they are
purchasing insurance. Discount plans are not considered health
insurance and currently are not regulated in all states. Consumers
should review plan materials carefully to be certain the benefits are
worth the cost.

The Better Business Bureau suggests you consider several facts about
these plans before making a purchasing decision:

1 Discount plans can be sold by anyone at any cost with any
benefits. They are not licensed insurance products, even when
sold by insurance agents.

2 The protections and rights available to consumers under
health insurance plans may not be available to members of a
discount plan.

3 Providers in the discount plan's "network" are often bound
by contract to participate in the plan and may stop offering
the discount at any time (without notice to plan members),
depending on the plan.

4 Many plans claim savings up to a certain percent. However.
"up to 40%" does not mean a guaranteed 40% savings.

If you are considering enrolling in a discount plan, ask the
following questions:

Is this plan an insurance product in my state?
What is the annual cost of the plan?
What are the benefits?
Do the providers I frequent accept the discount card? Be
sure to check with your provider as the information given by
the plan could be inaccurate.
If I have a health insurance plan and the discount plan, will
providers I use give me discounts on my co-payments or the
balance of my bill after my insurance pays its part?
Who do I call if I have a problem with the discount plan?
When receiving services that require immediate payment, is
there a way to verify I am actually saving money by having a
discount plan?
Can I cancel my membership at any time?