Watch with whom you associate for health insurance (Page 2)
By Lucy Lazarony • Bankrate.com

"Check with the insurance department in your state. That's really the best way to avoid being scammed," Kofman says.

Bankrate offers a map that links to each state's insurance department.

Wolf in sheep's garb
It's important to check out every insurer. No company should get a free pass. Some scammers set up shop naming themselves after well-respected financial companies. Even an insurance company with a well-known name may not be worthy of your trust, and may not be what you think it is.

"It's what I call corporate identity theft," Kofman says.

For example, Employers Mutual LLC sounds a lot like Employers Mutual Casualty Company, an Iowa mutual insurance company started in 1911 and licensed in 50 states and the District of Columbia.

And Vanguarde Asset Group, which left more than 160 people in Florida with $1.2 million in unpaid medical claims, sounds quite a bit like Vanguard Group, the well-known investment management company.

So get the precise name of the insurance company and do some digging. Is the insurer really connected to the respected company with the similar name?

Once you're sure an insurance company is on the up and up, it's time to take a close look at the health plan itself.

Read the coverage carefully. Make sure it meets your health care needs. A good association plan will accept all members, regardless of age or medical condition.

And you may want to ask about rate increases. Some association health plans raise rates for everyone whenever a member makes a claim. Sign on with one of these plans and you could get stuck with a big rate increase down the road.

Don't forget you're looking for an association health plan that beats the best individual policy that you can find on your own. A worksheet from Bankrate can help you compare policies.

There's a good chance that the association plan will be cheaper than an individual policy, but it may not be as comprehensive. Weigh your health plan options carefully.

Before signing on for an association plan, be sure to find out how much control an association has over its members' health care benefits and coverage.

"They look out for members' benefits if they're doing the job they're supposed to," Abbe says.

Does the association review the health plan's performance? Will it bargain with the insurer and negotiate lower premiums for its members? Will it step in when there's a problem with your insurance coverage?

A good association plan will do all of these things. Any research or digging it takes to find one will be worth the trouble.

"If you find a great association plan that meets your needs, then you've hit the jackpot," Kofman says.