Better Business Bureau News: What you don’t know can hurt you
There’s no shortage of scams out there today. Consumers of all ages and nationalities are targeted by con artists whose primary goal is to part you from your money. The best way to avoid being taken advantage of is to know more about an offer than what is presented to you.
One consumer purchase that continues to lag behind in consumer understanding and knowledge is health insurance. I often say consumers know only three things about insurance. They don’t want it. It costs too much. They have to have it!
The rising cost of medical care and health insurance has led many consumers to seek out cheaper ways of meeting their medical expenses. This, in turn, has lead to the rise of health insurance scams.
Since 2002, the BBB has seen a huge increase in consumer inquiries concerning discount medical health insurance programs. BBB quickly learned consumers need education to determine whether they were being offered health insurance or membership in a discount health plan. Our education efforts are paying off because consumers appear to be very skeptical when they see ads touting coverage, regardless of the applicant’s health condition, with lower rates and better benefits.
This hasn’t been the case for Texas consumers where Dallas and Fort Worth are among the worst areas in the nation for such fraud. Health insurance scams particularly target individuals and small-business owners who find it difficult to negotiate better rates with major insurers.
The goal of the scam is to collect a large amount of premiums as quickly as possible. The scam may pay claims initially but will soon start making excuses and delaying payments. Consumers who think they have medical coverage may be left responsible for huge medical bills. Employers who have signed up for such programs may be liable for the medical bills of their employees as well.
There are a number to things you can do to avoid becoming a victim of a health insurance fraud. If you are not familiar with the person or company offering the health insurance plan, check them out with BBB and the Tennessee Department of Insurance. Make sure the agent is selling a state-licensed insurance product. Be suspicious if the coverage seems unusually cheap, if the coverage is issued with few questions about the applicant’s health, or if the coverage is referred to as “stop-loss insurance.”
Know whether you are being offered health insurance or membership in a discount health plan. Discount health plans are not licensed insurance products, even though they may be sold by insurance agents. The protection and rights available to consumers under health insurance programs may not be available to members of a discount health plan.
If you need additional information, contact the Better Business Bureau at (615) 867-0032 during regular office hours and 24-hours a day at (615) 242-4222. You can also visit our Web site at www.gobbb.org.