A couple in Minnesota bought health insurance, well they thought they did.  Mary saw an ad at late night that you could by insurance for about $5 a day. 

She figured out, she can save some money.  And she bought this insurance for $499 a month.  But when they needed it, they found out that it was not an insurance.  It was a benefit card; merely a benefit card.

The irony is that Mary was no average joe.  She has worked over 27 years as a clinic and hospital manager.  She was still duped.  “I understand health care, and I understand health insurance,” she said. “That’s why I was so mortified that this happened to us.”

No one knows how many customers have fallen into this trap. But dubious health plans are “spreading like poison oak all over the country,” says James Quiggle of the Coalition Against Insurance Fraud, a nonprofit watchdog in Washington, D.C.

Just last month, Minnesota Attorney General Lori Swanson sued two out-of-state companies for allegedly misleading customers with phony claims about their health plans; 10 more investigations are underway, she said.

What Mary thought was a insurance card, it it read “Secure Care” by the United Service Association for Health Care (USA+), a nonprofit membership group in Texas. Their health plan turned out to be a “health care savings” program that offers discounts at participating providers. The customer, not the company, must pay the bills.

Mary Cranon, executive director of the United Service Association, said the Marry Lloyds should have known what they were buying because it was spelled out in the handbooks they received in February. She didn’t address the salesman’s claims, saying only that the programs are marketed by “independent contractors.” But she said the company lived up to all its promises.

In a letter to the Star Tribune on Friday, Cranon said that under the “contracted rate,” the Lloyds will get a $15,000 discount on their medical bills, lowering the total from $67,000 to $52,000.Mary Lloyd said that was news to her. The Lloyds received a bill from the hospital in September, saying they still owed the original amount.