(Washington, DC) During the month of November, a discount health care offer was sent by fax to individuals throughout the United States and the District of Columbia offering a “Health Plan” for $99.27 a month for an individual; $130 a month for a member and $150 a month for a family. This plan claimed to offer membership in an association that will provide savings on doctor, hospital, prescription, dental and vision expenses, among other benefits. The District of Columbia Department of Insurance, Securities and Banking (DISB) is today issuing a warning to consumers that it has confirmed that this is an overseas scam using US communications networks, and the operation is currently being investigated.
“There is a rapid proliferation of so-called discount health plans, which advertise for a low monthly fee so you can have a ‘health plan’ that meets your family’s needs,” said DISB Commissioner Thomas E. Hampton. “Such ‘plans’ offer nothing more than a discount when you go to a medical provider in their network. They are not insurance and provide no benefits if you are hospitalized.”
DISB is issuing this warning during open-enrollment season for health insurance (November 13 to December 11, 2006) as many consumers may be duped into thinking they are buying health insurance at lower rates.
“We are concerned that District residents will cancel their real health insurance plans for these bogus plans, thinking they are covered for any illness or injury,” said Hampton, adding that one of the problems is that DISB does not have clear jurisdiction over the discount plans since they are not insurance plans and are not sold as insurance. “However, DISB has a duty to warn the public of fake discounts health plans that may be confused with a real insurance product.”
Consumers are warned to look at all advertisements for discount health plans and look for the disclaimer, “This is not health insurance,” for the legitimate discount health plans. However, everyone should check closely before participating or call DISB for more information.
If you feel you are a victim of a fake health care plan, contact DISB’s Enforcement and Investigation Bureau at (202) 727-8000 or visit its website at disb.dc.gov.