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Blue Cross and Blue Shield of Illinois Offers Tips to Avoid Health Plan Scams

May 5, 2010

Health plan scams are targeting individuals, families, small businesses, seniors and recent immigrants who are considering purchasing health insurance coverage. In fact, the Coalition Against Health Insurance Fraud reported that roughly 12,000 consumers have already been victims of scams nationally.

According to Blue Cross and Blue Shield of Illinois (BCBSIL), people can take some simple steps to recognize and avoid insurance fraud.

"When you take the time to learn about your health insurance options, you're less likely to be the victim of a scam," said BCBSIL's vice president of Consumer Markets, Katherine Wright. "Getting the answers to the following questions will also help consumers avoid health insurance scams."

What are the specifics of the insurance plan?

Consumers should insist on seeing the entire policy, not just a summary of it, and make sure they understand it before signing up. It's important to be certain the plan is exactly as advertised. According to the Coalition Against Insurance Fraud, fake plans often promise full health coverage, affordable premiums, and easy sign-up despite preexisting conditions. Knowing and asking about details will help consumers avoid potential pitfalls.

How is the plan advertised?

Scams are pitched to consumers using telemarketing, faxes, TV ads, e-mails and sometimes printed signs posted in neighborhoods. Even Web sites encourage easy signup and enhance the appearance of legitimacy. So it's best for consumers to verify the plans they see advertised by comparing several sources.

What is the financial strength of the insurance company?

Taking time to research the company's financial ratings online could pay off. Health insurance companies should be in top financial shape because they cover millions of people, pay billions of dollars in medical claims, and need significant policyholder reserves in case a sudden public health crises.

How long has a company been around?

It's also important to evaluate a company's market longevity when seeking coverage, and to know how long a carrier has done business in the marketplace.

Is the plan licensed?

State law requires insurance companies to be licensed by the Illinois Department of Insurance (IDOI) and prohibits a health insurance policy from being sold unless it has been approved by the department. People can call the IDOI at (877) 527-9431 to check on licensing.

Does the company have a solid reputation among doctors and other health care providers?

Physician practices and other health care providers have experience working with health insurance companies all of the time. They may be willing to relay their experiences with a carrier in terms of how long it takes on average to have a claim paid and how accurate the payments are. Otherwise, patients could be held responsible for bills.

For more information, call the Illinois Attorney General's Health Care Fraud Hotline at (877) 305-5145.


About Blue Cross and Blue Shield of Illinois

With more than 7 million members, BCBSIL, a division of Health Care Service Corporation, a Mutual Legal Reserve Company, is the largest health insurance company in Illinois. Started in 1936, BCBSIL is committed to promoting the health and wellness of its members and its communities through accessible, cost-effective, quality health care. BCBSIL is an independent licensee of the Blue Cross and Blue Shield Association.


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