Menus Subscribe Search

Follow us


Health Care

Are Those Health Care Alliance Cards You Got in the Mail a Scam?

• March 29, 2013 • 12:40 PM

Pharmacy discount cards

The Rxrelief discount cards. The letter suggests giving extra cards to “anyone who could save money on prescription medications.”

Obamacare and its muddying of the medical-cost landscape offers newly fertile ground for advocates, entrepreneurs, and crooks.

So against that backdrop of the Patient Protection and Affordable Care Act, one of our staffers received an envelope—unsolicited—in the mail bearing resident code “HB-6357-14294” and containing  “pharmacy discount cards” and a letter welcoming her as a new member of Healthcare Alliance. It’s one of those things that almost require you to examine with jaundiced eyes. The cards, which reportedly can open the door to discounts up to 75 percent, were “pre-activated”—not a surprise since the unsought membership itself came pre-activated—and could be used immediately. At least the program didn’t ask for any money up front, and the letter says the cards “have no fees, now or ever—they’re absolutely free.”

The letter looked reasonably official, and while you might mistake it for something important from your own health insurer, it still had a sufficiently commercial edge that you wouldn’t mistake it for a government or genuine do-not-ignore-me document. (Oh, that I could say that of some of the junk mail I got after re-financing.) And the four cards from “Rxrelief” enclosed, each featuring a presumably unique membership identification number along with alphanumeric identifiers for “BIN,” “GRP,” and “PCN,” all suggest some official rigor is involved.

And yet … I expect most Americans, barring those still awaiting Nigerian fortunes, would echo my wariness about the Healthcare Alliance, as a little chat with my good friend Mr. Google bore out. As I typed in “healthcare all…” autofill suggested “healthcare alliance pharmacy discount card is it a scam” among other choices.

Spoiler alert: it’s not. But the words “skeevy” and “shady” do come up in online forum conversations about the cards, and so too does the not-exactly-ringing endorsement of “it isn’t overtly evil.” Online forums, as this exercise demonstrated, are also giant echo chambers, where one person’s suspicions instantly morph into the next person’s facts, and concerns, say about personal privacy, lead to baseless calls for a class-action suit.

At the same time, some posters say they’ve used the cards and are pleased saving money, but it’s a rough neighborhood when people are aroused. After “Darla K” posted this at the Topix forum for Lexington, Kentucky:

I have used the RxRelief Card. Not in Kentucky, but in New York. It saved me almost 50 percent on eye drops. I was skeptical too, so I e-mailed customer service. Someone got back to me right away and told me it was no strings attached, totally free, etc.

I’ve shared the card with friends too, and all have had a positive experience. If they have our personal information, I haven’t noticed any effects of that.

“EEE” responded, “Wow, you sound like you work for RXRelief. Caveat Emptor. Big Time” while “Cele” reported, “I’ve been checking other sites. This ‘Darla’ pops up on ALL of them.”

A little more sophisticated digging does no favors for the program. The D.C. address for the Healthcare Alliance actually leads to a mail drop at a UPS store on Connecticut Avenue just south of Chevy Chase Circle. Lest that sound a little questionable, rest assured that this particular UPS Store is a hotbed of medical-related services, including the Mesothelioma Victims Center at #138 (also the home of the Nursing Home Complaint Center!) and the National Council on Interpreting in Health Care at #119.

While the maildrop is in D.C., the business itself—which operates under the names Healthcare Alliance, Rxrelief, and Script Relief LLC—is located in New York City. Dave Lieber, who writes the Watchdog column at the Fort Worth Star-Telegram, phoned the company when he received a similar card last fall. He talked to Michael Loeb—this guy—in NYC, who explained about the maildrop, “It’s very convenient to get reply mail. We can’t in our New York office handle any reply mail directly. So we get it there, and it’s forwarded to us.” Can’t fault him for that; after all, I have a P.O. box, although oddly enough it’s in the same city I’m in.

The site scambook.com lists one complaint about the company, but the complaint echoes what I’ve written here: an unsolicited offer came in the mail. The same with Better Business Bureaus in various locales: a few complaints in the last two years, but mostly because something mysterious but quasi-official-looking arrived. I talked to my state’s Office of the Attorney General and the Federal Trade Commission, and after confirming that the program wasn’t touting itself as insurance, nobody at either office had anything untoward to report.

So I called Healthcare Alliance/Rxrelief/Script Relief, and while I’d expected to fight my way up the chain to eventually get somebody like Loeb to open up, instead I got a nonchalant but helpful customer service rep who identified herself as Desiree Smith.

How does the company make any money? They get a small amount, like a processing fee, from pharmaceutical companies when the cards are used; they’re aligned with this company to provide the discount the user receives.

Where are the cards accepted? At pharmacies the company has contracted with, and those negotiations also set the discount.

Who gets the cards? Some people opt to receive them, but others are drawn from sources (i.e. mailing lists) that identify likely users for the solicitation.

How many people use the cards? Smith said there are 800,000 cardholders, although the original letter says “more than 2,500,000 cardholders have saved $175,000,000 to date.” That comes to, by the way, $70 per cardholder, although I question whether a cardholder—I’m holding one now—equates to a card user.

And lastly, what do you do with my personal information? There is none – the cards are “completely anonymous” and the ID number is generic.

Hirka T’Bawa, a charter member at the StraightDope.com message board, explained the set-up from a pharmacy’s perspective:

As far as the pharmacy is concerned, you can use those cards just like an insurance card, we process them the exact same way. They give you whatever discount has been negotiated by the PBM (Pharmacy Benefits Manager). For most drugs and pharmacies, it would probably save you a little money from the cash price.

Or as forum moderator “stkitt” at HealingWell.com wrote two years ago:

The card works similar to insurance companies. It’s like a large buying group. Card holders pay pretty close to what the large insurance companies pay. The savings comes from the drug stores.

In fact, there’s a thriving little business model built on the cards, some that have a government imprimatur, some from pharma companies, some from nonprofits, and some from scrappy companies like Rxrelief. And if you’re not satisfied with the process or the savings, and people with insurance tend to already get cheaper meds already, don’t use the card.

I get discount offers all the time from third parties, offers that don’t make my antennae twitch. Sitting to my right, for example, is a flier for employee discounts from ADP, which handles our payroll. Oddly, while the sponsor for the discounts in this case is a health plan, CaliforniaChoice, the discounts are for things like amusement parks, dry cleaning, and Embassy Suites Anaheim.

So everything’s hunky-dory with these cards? Not necessarily. In determining that the FTC didn’t have a beef with these guys, the agency offered some examples of past discount card programs that had been scams or crossed a legal line somewhere.

Since I started writing this post earlier in the week, I received a glossy package from my new medical group telling me who my new primary care provider is and what wonders his practice offers me. Except I haven’t changed my provider and I don’t know yet if this is a scam or an honest mistake. And I routinely get a lot of solicitations—I’m looking at you, United of Omaha Life Insurance Company, and the FINAL Notification you sent both to my home and my P.O. box—that cross from hopeful to skeevy.

So I’m sticking to EEE’s advice. Caveat Emptor. Big Time.

Michael Todd
Most of Michael Todd's career has been spent in newspaper journalism, ranging from papers in the Marshall Islands to tiny California farming communities. Before joining the publishing arm of the Miller-McCune Center, he was managing editor of the national magazine Hispanic Business.

More From Michael Todd

A weekly roundup of the best of Pacific Standard and PSmag.com, delivered straight to your inbox.

Recent Posts

September 23 • 4:00 PM

A New Way Insurers Are Shifting Costs to the Sick

By charging higher prices for generic drugs that treat certain illness, health insurers may be violating the spirit of the Affordable Care Act, which bans discrimination against those with pre-existing conditions.


September 23 • 2:00 PM

Why Don’t More Women Commit Corporate Fraud?

Would having more female leaders reduce corporate crime? We don’t know, but the research suggests it’s likely.


September 23 • 12:00 PM

A Brief History of the Loch Ness Monster

From 1933—and possibly much, much earlier—to just this past May, people have been claiming (and staging) sightings of the famed water cryptid.



September 23 • 10:00 AM

The International Surrogacy Market

In Bangalore, where many women earn just $150 a month working in garment factories, surrogate mothers can make thousands of dollars by carrying others’ babies to term. But at what cost?


September 23 • 8:00 AM

Medicare: Your New Long-Term Care Provider

A 2013 court ruling has paved the way for an incredible, costly expansion of home health care by removing a critical lever the Centers for Medicare and Medicaid Services had to control who receives services, and for how long.


September 23 • 6:22 AM

On the Hunt for Fake Facebook Likes

A new study finds ways to uncover Facebook Like farms.


September 23 • 6:00 AM

The Heist: How Visitors Stole a National Monument

Fossil Cycad National Monument was home to one of the world’s greatest collections of fossilized cycadeoids—until visitors carried them all away.


September 23 • 4:00 AM

Fifty Shades of Meh

New research refutes the notion that reading the Fifty Shades of Grey trilogy strongly impacts women’s sexual behavior.


September 23 • 2:00 AM

The Portlandia Paradox

Oregon’s largest city is full of overeducated and underemployed young people.


September 22 • 4:00 PM

The Overly Harsh and Out-of-Date Law That’s So Difficult on Debtors

A 1968 federal law allows collectors to take 25 percent of debtors’ wages, or every penny in their bank accounts.


September 22 • 2:00 PM

NFL Players Are More Law Abiding Than Average Men

According to records kept by USA Today, 2.53 percent of players are arrested in any given year.


September 22 • 12:00 PM

Freaking Out About Outliers: When the Polls Are Way Off

The idea of such a small number of people being used to predict how millions will vote sometimes irks observers, but it’s actually a very reliable process—most of the time.


September 22 • 10:00 AM

The Imagined Sex Worker

The stigma against black sex workers can reinforce stigmas against all black women and all sex workers.


September 22 • 9:54 AM

All-Girls Schools Don’t Make Girls More Competitive

Parents, not educational setting, may be the key.


September 22 • 8:00 AM

The NFL, the Military, and the Problem With Masculine Institutions

Both the NFL and the U.S. military cultivate and reward a form of hyper-violent masculinity. The consequences of doing so have never been more obvious.


September 22 • 6:00 AM

Zombies in the Quad: The Trouble With Elite Education

William Deresiewicz’s new book, Excellent Sheep, is in part, he says, a letter to his younger, more privileged self.


September 22 • 4:02 AM

You’re Going to Die! So Buy Now!

New research finds inserting reminders of our mortality into advertisements is a surprisingly effective strategy to sell products.



September 19 • 4:00 PM

In Your Own Words: What It’s Like to Get Sued Over Past Debts

Some describe their surprise when they were sued after falling behind on medical and credit card bills.



September 19 • 1:26 PM

For Charitable Products, Sex Doesn’t Sell

Sexy women may turn heads, but for pro-social and charitable products, they won’t change minds.


September 19 • 12:00 PM

Carbon Taxes Really Do Work

A new study shows that taxing carbon dioxide emissions could actually work to reduce greenhouse gases without any negative effects on employment and revenues.


September 19 • 10:00 AM

Why the Poor Remain Poor

A follow-up to “How Being Poor Makes You Poor.”


September 19 • 9:03 AM

Why Science Won’t Defeat Ebola

While science will certainly help, winning the battle against Ebola is a social challenge.


Follow us


On the Hunt for Fake Facebook Likes

A new study finds ways to uncover Facebook Like farms.

All-Girls Schools Don’t Make Girls More Competitive

Parents, not educational setting, may be the key.

For Charitable Products, Sex Doesn’t Sell

Sexy women may turn heads, but for pro-social and charitable products, they won't change minds.

Carbon Taxes Really Do Work

A new study shows that taxing carbon dioxide emissions could actually work to reduce greenhouse gases without any negative effects on employment and revenues.

Savor Good Times, Get Through the Bad Ones—With Categories

Ticking off a category of things to do can feel like progress or a fun time coming to an end.

The Big One

One in three tourists to Jamaica reports getting harassed; half of them are hassled to buy drugs. September/October 2014 new-big-one-4

Copyright © 2014 by Pacific Standard and The Miller-McCune Center for Research, Media, and Public Policy. All Rights Reserved.