Health Insurance Scams

An awareness of health insurance scams will help you avoid fraudulent policies that could leave you without medical coverage when you need it most. As health insurance premiums rise, working professionals, families and seniors are searching for ways to save money on their medical coverage. Unscrupulous companies have taken advantage of the demand for affordable coverage by offering policies that have no authentic value. Your state's department of insurance can provide valuable information about identifying fraudulent providers in your area.

Individuals in search of personal health care plans and small businesses looking for group coverage are often the targets of fraudulent providers. Finding affordable coverage for yourself or your small company can be challenging. To protect yourself from health insurance scams, limit your search to licensed agents and insurance companies with a strong financial rating and a reliable reputation in your state.

Common Health Insurance Scams

Health insurance scams fall into several major categories. One common scam is the cheap insurance policy that offers coverage for a pre-existing condition. Individuals with serious health conditions who have been turned down by reliable insurance companies may be vulnerable to these scams. If you purchase a fraudulent policy to cover cancer treatment, heart disease, kidney failure or another serious health condition, you may pay premiums for months, only to have the insurance company disappear when you submit a claim.

Medical discount cards are another common health insurance scam. These discount plans may be promoted as a reliable alternative to health insurance; however, the discounts that you receive may not be as generous as they appear, and the savings may only apply to specific services or health care providers. Before you purchase a discount card, make sure the discount is accepted by the providers you visit regularly, for services that you actually need.

Many health insurance scams target senior citizens who are living on a limited budget and want to save money on the costs of Medicare copayments or prescription drug coverage. Unscrupulous providers may attempt to sell Medicare supplement policies or prescription drug plans that have no financial value when you try to submit a claim. Fraudulent salesmen may attempt to pressure seniors by telling them that they need to meet certain enrollment deadlines or purchase coverage in order to comply with new health care regulations.

Avoiding Health Insurance Scams

When you're on a limited budget, saving money on health insurance is always appealing. However, you may end up being financially responsible for large medical bills if the policy you buy isn't valid. All agents, brokers and insurance providers must be licensed to sell insurance in your state. Any reliable agent or insurance company should be willing to give you its license number, which you can verify with your state's insurance department. Your state and the Better Business Bureau will also have information on complaints against specific providers.

If you are approached by an aggressive salesperson who uses high pressure tactics or attempts to intimidate you with deadlines or references to health care laws, you may be the target of a scam. Promises of unrealistically low premiums or extensive benefits for a serious health condition are likely to be fraudulent. Most states have valid high risk health plans available for individuals who have been denied coverage elsewhere.

If you know the realistic cost of health insurance, you are less likely to be scammed. Compare the market to determine the average cost of insurance through reputable providers. If you have difficulty finding affordable coverage or have been turned down by at least one insurance provider due to a serious health condition, contact your state for information on high risk health plans.

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