Self Employed? Avoid Health Insurance Scams

A Health Care Article Contributed by Tandi Hartle

Self Employed? Avoid Health Insurance Scams

Sky rocketing health insurance premiums are creating a new cause for scam artists who prey on self employed individuals looking for lower insurance premiums. Advertisements posted in neighborhoods claim full family health insurance coverage for $59.95 a month. Unfortunately these low premiums are fraudulent and many fall victim to their enticing low price.

It is illegal in every state across the U.S. to sell health insurance without a license. These laws have not stopped over 129 fraudulent companies over the past two years in Texas alone. Self employed individuals pay out nearly $10,000 per year in health insurance premiums and often times fall victim to insurance scams.

Health insurance scams leave self employed, senior citizens and others to pay $85 million in unpaid medical claims.

Several of the largest insurance scam companies in the U.S. left victims with over $85 million dollars in unpaid medical bills. The largest number of victims are self employed individuals and senior citizens. Self employed individuals health insurance premiums directly effect their financial situations by significantly decreasing their amount of usable income. Buying inexpensive health insurance is very enticing to those paying high premiums but in the long run it can end up costing you thousands of dollars in unpaid medical bills.

What can self employed individuals do to protect themselves against health insurance fraud?

There are state insurance agencies that regulate all licensed insurance agents. Check with your state insurance agency to determine whether the company or individual you are dealing with actually has a license to sell insurance. In some cases fraudulent companies will hire unsuspecting licensed insurance agents to sell their product, so it is important that you not only check into the actual agent but the company as well.

Unbelievably low insurance premiums should be your first red flag. When a company offers to cover your entire family for mere pennies a day it is most surely fraudulent. These companies may pay some small medical claims just to keep from blowing their cover early. When larger claims are received they skip town with millions in paid premiums leaving thousands of victims with large unpaid medical bills.

Fraudulent companies will also offer to cover individuals with pre-existing conditions, serious illnesses or other medical issues that under normal circumstances would be denied coverage. Legitimate insurance companies have strict underwriting policies that prevent them from covering individuals with serious illness because they will pay out more in medical bills than the premiums will cover.

If you're self employed and looking for health insurance, it only takes a few phone calls to protect yourself from insurance fraud.

There are laws in place to protect against fraud yet, it is impossible for government agencies to keep up with the large numbers of con artists and fraudulent companies. It only takes a few phone calls or a visit to the state insurance agency to protect yourself against fraudulent insurance companies. You can call your accountant, attorney and state insurance agency and find out if the company is legitimate.

The only way to stop insurance scams is to avoid falling victim to their enticing claims by checking with state agencies and making these agencies aware when a company you have checked into does not have the proper licensing to operate in your state. By reporting fraudulent companies immediately you can help prevent fraudulent companies from operating and conning millions of dollars from unsuspecting victims.