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How to Spot a Medicare Scam

October 7, 2005
Since legitimate marketing for the federal program began October 1, consumers across the nation are becoming aware that, starting in January 2006, Medicare will begin to offer coverage for prescription drugs.

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As prescription drug plans, consumer and health advocates, industry, and the government begin to send information about the new drug benefit out to the public, people in Medicare will need to know how to tell if they are dealing with a reliable resource.

The National Consumers League (NCL) warns that con artists are already taking advantage of the fact that consumers will have various choices of Medicare drug plans by trying to offer phony Medicare drug plans. Their real objective is to steal consumers’ money, personal information, or both.

Medicare beneficiaries considering enrolling in a prescription drug plan, warns the advocacy group, need to be on the lookout for telltale signs that an offer may be fraudulent.

The Washington-based nonprofit organization has released new advice for Medicare beneficiaries at www.fraud.org that will help them avoid falling victim to a Medicare drug plan scam. Sample tips from the site include:

• Check the list of Medicare-approved prescription drug plans. If a plan is not on the list, it’s a scam.

• If someone says you must join or you’ll lose your other Medicare benefits, it’s a scam. The Medicare prescription drug benefit is voluntary.

• If someone asks for payment before November 15, 2005, it’s a scam. The plans are allowed to begin advertising on October 1, 2005, but they’re not allowed to begin enrolling people and asking for payments until November 15, 2005, which is the beginning of the six-month open enrollment period.

• Guard your personal information from identity thieves posing as sales people. Legitimate plans may ask for your Social Security number, but only when you are actually enrolling. And if you do join a plan, they can only ask for your credit card or bank account information if you are arranging to make automatic payments for your drug coverage from that account.

“Choice can be a very good thing, but crooks are always looking to take advantage of opportunities and might pretend to be from the government or legitimate companies to trick people into handing over their money or personal information,” said Susan Grant, National Consumers League Vice President and Director of the National Fraud Information Center. “But there are ways to determine if you’re looking at a real deal; to start with we always advise people to be extremely careful about giving out their Social Security and bank account numbers.”

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