Discount health plan organizations formed for the purpose of providing discount health coverage to members. As a customer, you agree to join the discount plan by filling out an application, and by paying for membership on a monthly or yearly basis. The discount plan can give you savings on medical, dental, vision, hearing, prescription, counseling, and more, depending on the plan.
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It is important to emphasize that the companies running the discount health plans are not insurance companies. A discount plan is not an insurance policy and does not give you comprehensive health coverage. Therefore, it is not a substitute for health insurance.
The Benefits of a Discount Plan
Some plans offer discounts of 10% to 40% on medical and dental services, for example. The health practitioner you will see as part of this system has already agreed to participate in the discount service by signing a contract with the discount company. The doctors have already agreed to a lower percentage of their normal fees and this percentage is passed on to you.
Deciding Whether the Discount Health Plan is Right for You
The discount card can help you get more services for your money. Your out-of-pocket money will go further with a discount plan, whether you have health insurance or not. What you need to watch, however, is whether the total of your membership fees for a year is more than the money you saved in discounts over the year. In other words, if the money you will pay to the discount plan is greater than the money you saved (not the money you spent), the discount plan will be of help to you. If you know you will spend a lot on health care services and prescriptions over the next year, it might help you to join.
For those people who cannot get health insurance because of a pre-existing condition, many discount health plans will not exclude you from joining. Unlike an insurance company, discount health companies do not pay the health provider for any services; they only guarantee discounts to you as a member. A requirement of not having seen a doctor in the year before membership may be all the plan requires.
Drawbacks to a Discount Health Plan
There are some drawbacks of discount plans for which you should be aware. Before signing up, make sure there are enough providers of care and drugstores in your local area. Also, check out who the providers are and whether they are trustworthy. You may be used to seeing one group of doctors, going to the hospital where they work, and using a particular pharmacy. With a discount health plan, this may not be possible. Another drawback to discount plans deals with good business practice. There is no regulatory agency that oversees them. You need to verify that they are reputable.
Always keep in mind that a Discount Health Plan is not insurance. Even with a discount plan, you pay the doctor or pharmacy for all fees out of your own money. Make sure you know every aspect of the plan before you decide to sign up.
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