What Is a Discount Medical Card?

Many people are familiar with dental or vision discount cards, or prescription drug discount cards. Discount Medical plans can be beneficial to consumers looking to save money on a much broader array of health care costs. These plans offer savings to plan members on various health care goods and services such as prescription drugs, doctor visits, eye glasses, vision care, dental services, hospitalizations, laboratory testing, and other health care services through arrangements between health care providers and the organization offering the discount plan.

Discount medical cards are growing in prevalence, partly because of the high prices of and limited access to private health insurance coverage. Discount cards are also attractive to people with pre-existing conditions, who cannot obtain individual insurance or are only eligible for very high-priced policies.

Cardholders do not have to go through medical underwriting, pay the same cost regardless of health or age, and cannot be excluded because of a pre-existing condition. Unfortunately, some consumers may mistakenly buy discount cards based on the erroneous belief that the cards are insurance policies.

Discount plans are supplemental plans that provide discounts on health care services. If health insurance is not a viable option for you, either due to a pre-existing condition that makes you ineligible or financial limitations, discount plans may offer a way to make doctor visits, treatment, and prescriptions more affordable. If you currently have health insurance but consistently find yourself paying costly out-of-network fees to see specialists or paying large sums for uncovered medical services, a discount plan may provide some relief.

How Do Discount Medical Cards Work?

First and foremost, it is important to understand that discount medical cards are NOT insurance coverage. Discount medical card companies do not pay claims for medical services. Instead, they negotiate with health care providers to offer discounted rates. Enrollees pay a monthly fee to access these negotiated discounts.  

Discount Medical Plans contract directly or indirectly with health care providers or provider networks to provide medical services at a discount to plan members. Similarly, Discount Drug Plans contract with providers or networks to provide pharmaceutical supplies, prescription drugs, medical equipment and other supplies at a discount to members. To become a plan member, you may have to pay fees, dues or other financial consideration to the discount plan organization. In exchange for the fee, you get a discount, provided that you go to a health care provider in the discount plan and receive the specific service that is covered by the plan. Each discount plan must provide a plan member or plan member’s family a discount card. Members present the card to their providers to receive discounted services, supplies, drugs and related care. The discount card includes:

• a statement that the discount medical plan or discount drug plan is not insurance;
• information identifying the discount medical plan organization or the discount drug plan organization and/or the provider networks that participate with the discount plan; and
• the telephone number that the plan member may call for assistance.

A discount medical plan organization or a discount drug plan organization is required to notify a plan member when there is a material change in plan benefits or the information contained on the card. If the information on the discount card changes, the discount medical plan or the discount drug plan must reissue the discount card(s).