Discount Health Plans

You may have seen an ad for a new health care program that promises health “coverage” for your whole family for a lot less than what you pay. It might promise discounts on prescription drugs.

However, discount health care programs aren’t insurance plans. Membership simply makes you eligible for discounts from participating doctors, dentists, hospitals and pharmacies. They’re under no obligation to reimburse you or your health care provider for your expenses. In addition, unlike health insurance plans, they are not licensed or regulated by the State.

It is important to remember that discount plans do not qualify as health insurance coverage. This means that if you drop your insurance coverage and use a discount card, you may be subject to waiting periods when you later sign up for health insurance, and you may also face financial penalties under the Affordable Care Act.

Check the Facts

• Don’t rely on what the discount program tells you about its participating providers. The information might be outdated. Before you join, ask your doctors and hospitals if they participate in the discount program and make sure they are accepting new patients enrolled in the plan.
• Be aware that some discount plans may refuse to tell you who participates in the plan until after you pay an enrollment fee. Without knowing if your doctor participates, there’s no way to know if the card would be helpful.
• If you want to use both the discount program and your insurance coverage for the same visit, make sure that your providers will permit this.

Read the Fine Print

• Make sure you understand what you are signing. For example, the rules could state that if you cancel before the membership term ends, you will still be obligated to pay the remaining monthly payments. Or, if you paid an annual fee, you may not be entitled to a refund.
• The rules may also state that your membership will be renewed automatically unless you notify the program by a deadline that you do not wish to renew.

We Can Help

If you have a complaint about a discount health plan, contact us for help online or call toll free within North Carolina at 1-877-5-NO-SCAM. You can also check with the Better Business Bureau.

For more about avoiding health care scams watch Diagnosis: Fraud, an excerpt from our consumer protection video Standing Up, Fighting Back.