Discount health plans are not health insurance
It is often mistakenly thought that discount health plans offer the same type of coverage as regular health insurance. Consumers need to be aware that buying a discount health plan is not the same as having health insurance.
Function
The function of regular health insurance is to cover some or most of your medical costs covered under the plan. The function of a discount medical plan is to provide you with a card and a list of providers who, when presented with the card, may provide their services at a discount.
Out-of-Pocket Costs
When an individual has a medical discount plan he is responsible for paying the membership fee for the plan plus any and all charges from his medical providers. While listed providers may charge a discounted price for their services, the medical discount plan does not pay any of these costs on behalf of the member. Regular health insurance premiums are usually higher than medical discount plan membership fees, but health insurers pay some or most of covered medical costs over required copays and deductibles.
Medical Providers
According to the Coalition Against Insurance Fraud website, discount health plans may list doctors and hospitals as being participants with their particular plan when this is not actually true. An individual with a discount health plan may not receive any discount at all for services. A regular health insurance plan contracts with doctors, and official plan documents make clear to patients what doctors and services the plan will cover.
Considerations
While discount health plans are not ideal, these plans may be a good last resort option for uninsured individuals who cannot afford to pay for private insurance. The discounted medical fees can save money for individuals with high health care costs. Research the plans carefully and contact listed health care providers to make sure they do participate and will offer a discount.
Tags: health insurance, health plans, discount health plans, discount plan, medical discount, medical discount plan
