By Laura Hipshire
THE ERICKSON TRIBUNE

There’s no doubt health insurance is one of today’s hottest topics. Many people are either uninsured or underinsured, and if they’re not, they’re about to lose benefits they’d been banking on for many years.

It’s during times like these that unscrupulous individuals try to lure desperate people into believing they have just what the doctor ordered when it comes to health insurance.

Empty promises
According to the Federal Trade Commission (FTC), the nation’s consumer protection agency, some medical discount plans claim to provide big discounts from hundreds of providers on a wide range of services from doctor visits and dental exams to hospital stays and prescription drugs. But many plans fail to make good on those claims.

The FTC and several states have found that although some medical discount plans provide legitimate reductions that benefit their members, others take consumers’ money and offer very little in return.

Bait and switch
According to the National Association of Insurance Commissioners (NAIC), a typical fraudulent health insurance scam attempts to recruit as many local insurance agents as possible to market the coverage. Agents are told the coverage is regulated by federal law, not by state law when, in fact, this is illegal.

The coverage is typically offered regardless of the applicant’s health condition, at lower rates, and with better benefits than can be found from licensed insurers. The scam seeks to collect a large amount of premium as rapidly as possible.

While claims may be paid initially, the scam operation will soon begin to delay payment and offer excuses for its failure to pay. Unsuspecting consumers who thought they were covered for their medical needs are left responsible for huge medical bills. Employers who sign up for these illegal plans may be liable for the medical bills of their employees as well.