Samantha Malm, MD testified last week at a Department of Managed Health Care (DMHC) hearing regarding "discount health plans." These plans often promise consumers discounts on physician visits and procedures that cannot be delivered. Patients arrive in physicians' offices hoping to receive treatment or believing that they are insured when they are not.

In 2001, the Attorney General reviewed the discount health plan business model and concluded that a corporation may not charge an annual subscription fee, including a reasonable profit, for furnishing a list of physicians willing to provide medical services at discounted rates to uninsured indigent persons. Dr. Malm explained to the DMHC that the very act of developing these regulations will legitimize such illegal activity. Further, while these regulations may inhibit unfair (and dangerous) business activity, their complexity may make full enforcement difficult or impossible. Partial adherence of the regulations by unscrupulous discount plans may create the appearance of legitimacy. In short, to regulate something that has already been determined to be illegal is inappropriate and dangerous.