According to Consumer Reports (3/12), junk insurance is insurance with low premiums that often covers very little medical care for the policyholder. In the case of Judith Goss, whose story was covered in the Consumer Reports article, her insurance plan covered only $1,000 a year for outpatient treatment and $2,000 for hospitalization - a problem when she was diagnosed with breast cancer and faced a $30,000 bill.
Such junk insurance has reportedly been sold in California, with regulators shutting down HeathcareOne, a program that offered discount cards for health care. Unfortunately for consumers, when they tried to use the healthcare discount cards, they could not find a provider who would offer the discounts.
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Adams has reportedly filed a lawsuit to cover his unpaid medical costs. His lawsuit alleges improper benefit denial and deceptive marketing. Lawsuits have been filed against other companies selling so-called junk insurance across the US, as well, with plaintiffs alleging they were misled into believing the insurance was comprehensive medical insurance when in fact the coverage was severely limited and left consumers with high medical bills and debt.