October 21, 2002
Seniors should be wary of telemarketers offering prescription discount programs. The Rhode Island attorney general last week sued Derek, alleging that it was violating the state's's Deceptive Trade Practices Act.
Typically, seniors are contacted by a telemarketer, who offers to reduce their prescription costs by 80 percent. Those who agree -- and even some who say they didn't -- are charged $349 for an information packet.
"I received a call that they were offering health insurance at a discounted cost of $349 and I asked them if I could receive some information on the insurance. They then proceeded to ask me for my checking account information. I had asked them if the money was going to be removed from my account right away or if it would be removed if I decided to purchase the insurance and from what I understood they were not going to take it out of my account."
Derek of Houston told ConsumerAffairs.com in July."Seniors are desperate -- they're trying to find prescriptions they can afford," Tatiana Fassieux of California's Health Insurance Counseling and Advocacy Program (HICAP) said.
Seniors should not give out personal information such as bank account numbers, Social Security numbers or Medicare numbers to telemarketers, Web sites or anyone they don't know personally, consumer advocates say.
Further, seniors need to look very carefully at any discount program they're being asked to pay for, Faxxieux said. "We tell them, 'Do the math,'" she said. It often turns out the discount does not make up for the cost of the program -- or, more often, the supposed discounts may not even exists.
Prior to last week's action, Rhode Island Attorney General Sheldon Whitehouse issued a cease and desist notice to MedPlan, instructing the company to stop its telemarketing activities in Rhode Island.
MedPlan, also known as Health Services Merger, Inc., is based in Greenville, SC. The Associated Press reported that the company has an unsatisfactory record with Better Busienss Bureaus in South Carolina, Florida and New York.
