Medical discount cards dont provide insurance coverage
of ConsumerAffairsMay 2, 2025
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The FBI is warning consumers nationwide about scams involving discount medical insurance plans that offer fake healthcare coverage.
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These scams exploit people seeking affordable care by promising low-cost plans that dont actually provide insurance.
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Victims across several states have reported financial losses, denied claims, and unauthorized charges from fraudulent companies posing as legitimate insurers.
The FBI has issued a stark warning to the public about a surge in discount medical insurance scams that are defrauding Americans out of millions of dollars each year. The scams target people searching for affordable healthcare options and deceive them with fraudulent insurance plans that ultimately offer no real medical coverage.
The FBI’s alert comes on the heels of increasing reports of deceptive practices by companies claiming to offer discounted medical insurance. These organizations misrepresent the scope of their coverage, pressure victims to act quickly under the guise of time-sensitive offers, and frequently make unauthorized charges to their customers bank accounts.
Multi-state scheme
Washington state officials recently took action against one such company, issuing a cease-and-desist order after receiving over 100 consumer complaints. The company, which operated under multiple business names, routinely misrepresented coverage details and failed to refund customers after policy cancellations. In some cases, victims were even charged after attempting to opt out of the plans.
The FBI said these fraudulent activities have affected consumers across the country:
In Pennsylvania, a couple was pressured into purchasing a supposed national plan at a discounted rate, only to find out after an ER visit and doctors appointment that none of their expenses were covered.
Another Pennsylvania resident was duped by a representative who falsely promised a cheaper plan and a refund on his current coverage. After switching, the refund never arrived, and the company became unreachable.
In Texas, a senior citizen was baited with offers of help for groceries and gas but was required to sign up for a dental policy first. After doing so, he was ignored when he tried to cancel and had to resort to cancelling his credit card to stop the charges.
In Maryland, a man was promised comprehensive coverage for a full year after an upfront payment. However, during a medical emergency, he discovered his insurance was not accepted and was left with a $7,000 hospital bill.
FBI urges vigilance
Authorities say these scams often begin with unsolicited communications including calls, texts, or emails offering limited-time deals or claiming to be from established insurance providers. Many victims are misled into believing they are signing up for legitimate policies, only to face unexpected out-of-pocket costs and denied medical claims.
To protect against such fraud, the FBI recommends the following:
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Verify the legitimacy of the insurance provider with your states insurance department or the Better Business Bureau.
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Consult your healthcare providers to confirm that they accept the proposed insurance plan.
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Demand policy documentation and thoroughly review the fine print.
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Avoid upfront payments, especially if accompanied by high-pressure sales tactics.
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Research independently, and remember: if a deal sounds too good to be true, it probably is.
The FBI continues to investigate these fraudulent schemes and encourages anyone who suspects they may be a victim to report the incident to their state insurance regulator or file a complaint with the FBIs Internet Crime Complaint Center.
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