Find out what you are buying. Ask: "Is it insurance or is it just a discount plan?" With an insurance plan, you pay a premium, deductibles and/or co-payments may apply and then the insurance company pays the provider (doctor, dentist, hospital, etc.) Insurance policies are regulated by state insurance laws and offer consumers protections under those laws.
With a discount plan, you pay the provider directly but you may receive a discount because you are a member of the plan. For example, if the dentist normally charges $100 for a dental visit, he might charge you $80 because you are a member of a particular plan. Discount plans are not regulated by state insurance laws.
If you are told a plan is an insurance plan, find out the name of the insurance company and make sure that company is licensed to sell insurance in North Dakota. Call the North Dakota Insurance Department at 800.247.0560 or visit our website at http://www.state.nd.us/ndins/. Also ask the Insurance Department if any complaints have been lodged against the company. Check with your current providers to see if they accept the discount plan offered by the company and, if not, find out if there are any providers in your area who accept the plan.
If you are told a plan is a discount plan, research information about the company that runs the plan before you enroll:
Ask for their website address so you can find out information about what they provide (remember that having a website does not necessarily make a company legitimate)
Search the Internet to see if people or government agencies have made complaints or brought lawsuits against the company
Determine whether the discount plan makes economic sense--will you actually save money by joining? Be sure to understand the cost of the enrollment fee and any monthly fees. Ask your doctor, pharmacist, and other health care providers if they accept the plan and will give you a discount. Also find out what that discount is. If you hope to use doctors from the plan's network, ask for specific information about plan doctors in your area.
Remember that with discount plans, you are not protected against catastrophic losses. There is no limit to your exposure to medical costs. For example, if you received a 20 percent discount off your $100,000 surgery and hospital stay, you still would be required to pay $80,000 out of your own pocket.
Do not agree to join until after you have seen all of the membership materials and reviewed them to your satisfaction. Do not fall for the 30-day money-back guarantee. If the company does not send your membership materials promptly, or does not answer their phone when you call to ask questions or to cancel your membership, those are warning signals.
Do not sign up for a plan that requires that you join the plan and pay money before it will disclose who your local providers are.
Never give a company your credit card or bank account information. There is a risk that companies will use this information to make unauthorized charges on, or withdrawals from, your accounts and may also pass your account information on to other companies.