Do your insurance co-pays burn holes through your wallet? Looking for a way to afford expensive prescription drugs or braces for the kids? Some consumers turn to health care discount cards. Supposedly, showing the card to a participating pharmacist, dentist or other provider will result in steep price reductions. But that’s not necessarily the case.

Discount cards aren't the same as health insurance policies, according to the Federal Trade Commission. Insurance covers a variety of services by paying a portion of your overall medical bills. A discount card, on the other hand, offers you lower prices when you buy certain products or services.

“These programs are about getting better prices on supplemental services left out of one’s existing insurance coverage, which may include dental and vision care for adults, hearing aids, chiropractic services, acupuncture and 24/7 telemedicine,” says Allen Erenbaum, spokesperson for the Consumer Health Alliance, an industry group representing discount card providers.

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Will it save you money?

Here’s how to figure it out.

  1. Write down how much money you expect to spend on health care during the year if you don't use the health care discount card.
  2. Add all the fees and premiums the card company would charge you during the year if you were to buy the card.
  3. Subtract how much money you expect to save during the year if you were to use the card.
  4. Look at the total. Is it less than what you would spend without a card? If so, you might save money by using it. If it's more, you probably won't.

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How to buy a card

Be careful doing business with a company you're not already familiar with. Scam artists have been known to trick people into purchasing an overpriced card by claiming, falsely, that it's really a form of insurance. Last year the Federal Trade commission took legal action against alleged fraudsters for doing just that.

Industry oversight has improved in recent years, according to Erenbaum. “States and regulators have enacted laws across the country that succeeded in regulating the industry, thereby pushing fly-by-night operators engaging in fraud out of the marketplace,” he says.

When in doubt, contact your state insurance commissioner to ask whether it's an insurance policy or a health discount card and if the company is licensed to sell either. In all cases, before purchasing a card:

Check out the company. Look them up on Better Business Bureau or other ratings sites. Your insurance commissioner or state attorney general many also have a file on them. Search online for the company's name along with the words “scam” or “complaint.”

Read the fine print. If they charge a large sum of money up front, instead of just a small monthly fee, treat them with caution, advises the Kansas Attorney General

“Review the program’s summary and details, and double-check the terms, conditions and 30-day cancellation policy before making a purchase,” says Erenbaum.

Call the listed providers. Ask the card company for a written list of providers — such as pharmacies, dentists or clinics — that honor the card. Then contact any providers that you may want to use and ask if they really do honor that card, and confirm the degree of discount the card will get. If yes, ask if they offer the same discount level the card company claims they do.

Call your local providers. Sometimes the card company will base its discounts on average prices that are higher than the ones offered by the providers in your area, according to the Better Business Bureau. Contact some local providers and ask about their prices — it may be that the discount card saves you nothing. If you're hurting for money, some providers may even have a patient assistance program.

Go shopping. Why buy a card if you can enjoy the savings for free? Some insurance companies offer their policy holders a complimentary or low-priced card. So might your bank, employer or an organization where you're a member. With some organizations, such as AARP, presenting your membership card can get you a discount.

“The important thing is for people to be sure that the program offers consumer-friendly protections such as clear descriptions of the membership terms, a readily available list of participating providers, a 30-day trial period and good customer service,” says Erenbaum.

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David Arv Bragi is a freelance journalist and marketing consultant. He has been writing about health and safety issues since the 1990s and currently lives in Portland, Oregon.