Health care costs are one of the biggest drains on our pocketbooks, so everyone is looking for ways to save. But the feds say one option you'll see sold all over isn't the solution you think.
You've heard the claims of affordable plans with no deductible, commercials offering plans with big discounts on care, saying pre-existing conditions are no problem. Those ads sound like they're selling health insurance, but the Federal Trade Commission says that's not the case.
Arturo DeCastro, an FTC attorney, says the pitches you're hearing are for medical discount plans and there's a big difference. He explains, "Medical discount plans aren't health insurance and they're not a substitute for health insurance and in some instances these plans are just flat out scams."
The FTC has launched a huge campaign to let people know about the scams as part of Operation Healthcare Hustle. DeCastro says, "It's the FTC's effort to stop scammers who are fleecing consumers out of millions of dollars a year who are in desperate need of health insurance."
But you're not paying for actual healthcare when you get these plans. Instead the FTC says you'll pay a fee to find providers who may offer discounts on things like doctor visits, drugs or even dental exams. Although once you've paid, the feds say many don't live up to their promises.
So before you buy these plans, you should research the company with the Better Business Bureau, the Maryland Insurance Commission and the Attorney General. It's also important to ask the company for a list of their providers. Once you've seen their list, contact the providers directly to see what the discounts they offer and whether you'll get your money's worth from the plan.
DeCastro says if the company won't give you written info about the plan, that's a red flag. He also believes high pressure sales tactics should also make you leery, "Legitimate plans or health insurance providers won't pressure you into buying product immediately so you should take that as an indication that the plans that's being marketed may not be what you think it is."
If you're sold a bogus or bad medical discount plan, the FTC says you should file a complaint with their agency at www.ftc.gov as well as the BBB and the Maryland Attorney General.