If you have health insurance, you will probably pay the insurance company’s discounted rate for services and prescriptions when you present your card.  This rate is also known as the negotiated rate.  In this sense your ID card becomes a health insurance discount card.

However, your ID card (or the insurance behind it) provides you with more than a discount on medical services.  It probably limits the amount you would have to pay out of pocket in a catastrophic situation.

You may have a $5,000 out-of-pocket limit on your policy.  This can mean that even if you have a $75,000 hospital bill your costs are limited to $5,000.

(With some policies you will continue to pay your co-pays even if you have met your “out-of-pocket-limit”.  Also your deductible may be separate from your “out-of-pocket-limit.  This can mean that you pay your deductible plus your “out-of-pocket-limit.”)

With a discount card you may get 10% or 25% off any covered services but there will not be a limit to what your costs can be.  This means that in a scenario where you have a $75,000 medical bill and get a 25% discount, you will still be responsible for $56,250 of the costs.

Unfortunately, some of us cannot afford or cannot medically qualify for health insurance.  A discount card that is not connected with a health insurance policy can reduce your bills if health insurance is not available to you, but it is important that you know that that there is a big difference between a discount card and health insurance.