Don't get caught up in a discount health scam

As millions of people lose their employer-based health insurance after being laid off, they seek desperately to find affordable health coverage. Unfortunately many people get caught up in discount heath schemes rather than real health insurance coverage.

California is taking the lead on cracking down on these discount health and dental plan frauds with a plan to seek new licensing regulations. Right now in California, consumers have lodged complaints against more than 150 unlicensed discount health and dental plans over the last four years. State regulators want to rein in these plans that officials say frequently overstate benefits, offer little if any savings and promise access to doctors who aren't part of the system.

Not all discount plans are bad. California state officials identified two major health insurers with units in California, for instance, that have not been the subject of any consumer complaints to state regulators. The two -- Vital Savings, a product of Aetna, and OptumHealth Allies, an arm of UnitedHealth Group -- do not offer insurance but provide access to discount services to thousands of members.

So considering a discount plan is not necessarily a bad thing, but be sure you understand the difference. Discount plans are not health insurance. They only offer a discount if you use the physicians or other medical facilities that are part of the plan. One of the biggest problems I've found with these discount cards is that most physicians do not accept the plan and that a list of physicians provided by the plan often is not up to date. If you can't afford health insurance and are considering a discount plan instead, get a list of providers and call them those you may want to use to be sure they recognize and still accept the plan before you sign up.