Be wary of health discount cards.(Front Lines)(Consumer Alert)

At a time when Americans are looking harder than ever for ways to save money on their health-care bills, along comes this idea: medical discount cards. You pay a monthly fee, which can range from $10 to $120 depending on the plan, and you're promised reduced rates at participating pharmacies, hospitals, and dentists' and doctors' offices when you present your card.

Maybe you've seen the ads. AmeriPlan USA says it provides discounts on dental work, prescriptions, chiropractor visits, and eye care. Care Entree offers breaks on, among other things, doctors' office visits, prescription drugs--even veterinary care. Chamber Health card coverage includes hospital visits, surgery, and emergency-room visits. Many companies operate in several states; others limit coverage to one state or metropolitan area.

But discount-card plans have pitfalls of which consumers may not be aware.

DRAWBACKS

Card programs often work like this: The company negotiates discounts and buys provider lists from preferred provider organizations (PPOs); the company generally does not contract directly with service providers. Some cardholders have reported that doctors, hospitals, and pharmacies said they didn't know about the discount programs and wouldn't honor the cards.

Because discount-card programs are not insurance plans, the programs are not regulated by most states. The people who sell the cards do not need to be licensed, nor do they need health-care experience.

It is also hard to know whether you are getting a true discount because detailed price lists from participating providers are usually not available or verifiable. And there's no control over how companies use the private medical information you supply when you use your card for treatment.