As human beings, and as smart consumers, we are always looking for good deals. Why pay full price for something if there's a bargain to be had, or if we can negotiate the price so that we feel like we're getting better value for each dollar we spend?
Further, as human beings, when we are fearful, or desperate, or horribly uncomfortable, we are willing and too capable of believing things that cannot possibly be true, putting ourselves in jeopardy of making bad choices based on bad information, only to be compounded later when those bad choices cause even more problems.
Unfortunately, the purchase of health insurance can too easily fall into either of these categories. For most of us, purchasing health insurance is simply the lesser of two evils. (The other evil being paying full price for expensive healthcare with no insurance to subsidize the cost.)
In addition, with the advent of ObamaCare and the pressure to fulfill the individual mandate, we feel we need to make choices we aren't prepared to make to be sure we aren't fined for non-compliance.
As a result, it's very easy for us to fall for fraudulent health insurance schemes, where we think we are buying into something useful, only to learn later that we've been 'taken' by someone who never intended to help us pay for healthcare, and only intended to steal our hard-earned money.
Further, if we do fall for one of these scams, we not only lose money, but it can actually have a negative impact on whether or not we get the care we need when we need it, and whether or not we are eligible in the future to obtain real health insurance.
Fraud in healthcare can be found in almost every aspect of healthcare, from quacks to scams. In particular, since passage of the Affordable Care Act (healthcare reform), health insurance scams have been appearing with more frequency. Mainstream press (CBS, Fox, USA Today and others) have reported on a number of seemingly legitimate payers who have, instead, collected people's money, then did not cover what those people expected.
It is anticipated that over the next several years, even more will appear, calling themselves things like health benefits insurance, medical payment plans, medical discount cards, medical claims plans and others.
We need to protect ourselves and our families by being sure that any health insurance company we engage with is a bona fide, well-funded, capable company that can and will actually fulfill its promises, and provide us with all the benefits they claim they will provide.
As you research your options for purchasing health insurance, be mindful of these signs that you should walk away:
- Avoid any company with aggressive salespeople. Don't purchase insurance from any company that phones, faxes or emails "good deals".
- Avoid any promises of better pricing if you sign up right away. Real insurers don't insist you rush through your decision-making (although there can be deadlines for signing up by certain dates, like at the end of the year.)
- If a salesperson tells you that purchasing insurance is "required by law," then hang up or delete the email.
- If the salesperson tells you they are licensed by ERISA, that's a sure sign that they are bogus. All insurance companies are licensed in their states of business, but ERISA is a federal organization.
- If what the company offers you is called a "medical discount card" then there's a good chance it won't cover what you need. Be sure to check with your doctors, pharmacy and testing centers to see if they accept that card, and if they do, how much the discount really is. (The same is true for pharmacy discount cards.)
- If the cost is substantially less than any other pricing you have found, then walk away. Like Mom told you - if it sounds to good to be true, then it is.
- Avoid any company that has a process for acceptance that seems less demanding than another. People have been known to fall for scams just because they were told they didn't need to have a physical exam, or because they weren't required to provide a list of their current medications.
- Pay attention to your intuition. If you have any suspicion that someone or something isn't what it says it is, then walk away.
If you have found a company you think you'd like to purchase health insurance from, take the following steps to be sure it's bona fide:
- Check the list of insurance scamming companies to be sure that company is not on the list. (Please note: absence from this list does not guarantee the company is bona fide, but if the company is on this list, it's a good indication that you're dealing with a scammer.)
- Ask for a copy of the policy you would be purchasing, then read it to be sure it covers what you understand it should cover.
- Be sure the company is licensed in your state. You can find a state-by-state list of insurance commissioners here.
- If the company you're talking to claims they provide insurance through another company that has a name you recognize, then check with that company to be sure the claim is true. (e.g. XYZ health Insurance claims it is a broker for Aetna - be sure you contact Aetna to confirm.)
If you do run across a bogus insurance company that is trying to scam you:
Collect all the information you can from them about their potential insurance, business, and how they work with you. Then report them to your state's insurance commissioner. Provide them with all the documentation you have collected.
...And move on to make a better health insurance choice for yourself and your family.