Things that are Too Good to be true: The Financial Deception

| September 19, 2012
The Financial Deception

The Financial Deception

America’s drooping economy pushed people to tighten their belts in order to survive life’s daily ordeal. Health is one aspect greatly affected by the economy’s downfall as it shifted the paradigm from “ideal” to “practical”. People are now attracted to cheaper health plans and lower premiums that offer the same coverage for a lower cost: an offer that sounds, looks good, but may be deceiving deep down.

The Father Son Story

Meuthen,Massachusetts-an owner of a small welding and fabrication business is struggling to pay for his expenses. Paul Gaznick’s business is just one of the many establishments hit by the economic downfall. Since 2007, contracts and deals have slowed and trickled, and this slow progress didn’t do much for his need to cover the expenses (especially the health insurance premium). As a single father who wants to provide his son the best care possible, he started to shop around for health plans that would not be so much for his trickling finances. Gaznick’s current health plan costs him a staggering $750 a month, considering it’s only him and his teenage son who is covered by the premium.

A promise of relief came when he received a fax about a health premium which only costs $289 per month. The fax was an advertisement from a company named National Alliance, and it promised of a low cost yet quality health care both for the individual and the entire family. With the business such in a bad shape, Gaznick’s only option is to have the premium. After signing up for the premium, his son suffered burn injuries from a car accident and needed to be hospitalized. To his surprise, the plan he signed up for didn’t pay for the astounding medical bills. It turns out the plan is just a membership for a club or a medical discount program and the monthly fees are just payment to gain access to a list of physicians and hospitals that were said to give discounts.

Gaznick’s story is just one of the thousands who sign up for health care plans for a lower price but end up being duped and paying the bills right from their own pockets.

What Should You Do? Don’t be Deceived!

If you are new to the system, that is an opportunity for deception and confusion. A state attorney general said who sued three executives of National Alliance for their illusive a practices. OtherU.S.states such asMinnesotaandCaliforniaare also starting to do the same and are now beginning to regulate the emergence of these types of insurance companies. Even though such deceptive practices caught the eye of government officials, still this marketing practice proliferates; more so lawsuits filed for these insurance companies often take years to settle. Consumers must be more skeptical and know what they are buying; this is according to Jenny Libster, the senior research associate at the Commonwealth Fund. Insurance companies are likely to target people who have the financial capability to buy the premium at the same time the capability to pay, but the marketers for these premiums are now expanding their consumers, now they seem to focus on low income individuals with an existing health condition.

Another advice experts say is to be skeptical. Most plans that have a price below the standard rates often do not cover much or are not insurance plans at all. Examples are medical discount plans; this type of plan charges for monthly membership fees that some individuals mistake for premiums. The plan promises to provide a list of hospitals or doctors from which you can avail of discounts, but they do not cover medical bills. Another example is the limited benefits plans; this works like traditional insurance because it has monthly premiums and reimbursements. It is also important to note that this plan only covers specific procedures.

Author Bio

Amarendra, the guest author writes for http://www.opendoorloan.co.uk about instant loans and pay day loans.

Things that are Too Good to be true: The Financial Deception

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