Discount medical cards: innovation or illusion?

Area of Science:

• Health economics
• Consumer protection
• Regulatory affairs

Background:

• Discount medical cards are increasingly scrutinized by regulators and law enforcement.
• Consumer-reported problems with these cards have been mounting.
• The market for discount medical cards is growing but largely unregulated.

Purpose of the Study:

• To evaluate the value and drawbacks of discount medical cards.
• To investigate consumer-reported problems associated with these cards.
• To assess the need for legislative and regulatory interventions.

Main Methods:

• Testing of five discount medical cards in the Washington, D.C. metro area.
• Interviews with card company representatives, state attorneys general, insurance regulators, and agents.
• Review of court and administrative actions related to discount medical cards.

Main Results:

• Some discount cards offer value to consumers.
• Serious drawbacks were identified, including high-pressure sales, misleading promotions, and exaggerated savings claims.
• Difficulties in finding participating doctors and providers failing to honor discounts were reported.

Conclusions:

• Legislative and regulatory interventions are necessary to protect consumers in the discount medical card market.
• While some industry self-regulation efforts exist, they are insufficient.
• The findings highlight significant consumer protection issues in this growing market.