What Happened to AmeriPlan? The Rise and Fall of a Discount Plan

For many Americans seeking affordable healthcare in the early 2000s, AmeriPlan was a familiar name promising significant savings on dental, vision, and chiropractic care. Its multi-level marketing (MLM) model attracted thousands of independent representatives who sold memberships door-to-door and online. Yet, today, the company is largely defunct, its name synonymous with controversy and regulatory action. Understanding what happened to AmeriPlan is not just a business case study, it is a crucial lesson for consumers navigating the complex landscape of healthcare savings products, discount plans, and insurance alternatives. The story involves aggressive marketing, legal battles, and fundamental misunderstandings about what these plans actually provide.

The AmeriPlan Business Model: Discount Plans, Not Insurance

AmeriPlan Corporation, founded in 1992 by dentists David and Jerri Clark, operated on a simple premise. For a low monthly fee, typically ranging from $20 to $50 for individuals or families, members would gain access to a network of healthcare providers who agreed to offer services at a discounted rate. These were not insurance policies. Instead, AmeriPlan was a discount medical plan organization (DMPO). This critical distinction was often blurred in marketing materials and sales pitches. Insurance involves the transfer of risk: the insurer agrees to pay for covered services after deductibles and copays. A discount plan merely offers a reduced price that the member must pay out-of-pocket in full at the time of service. The savings could be substantial, sometimes 50% or more off standard fees, but the member bore the entire financial burden.

The company grew rapidly through its MLM structure. Independent representatives, often called Independent Business Owners (IBOs), earned commissions for selling memberships and for recruiting other representatives into their “downline.” This created a powerful incentive to emphasize the income opportunity over the product’s details. Sales materials and representative training frequently highlighted the potential for six-figure incomes and financial freedom, which attracted many people during economic downturns. The focus on recruitment and the promise of passive income from downline sales are hallmarks of MLM models that have drawn scrutiny from regulators and critics who argue they can resemble pyramid schemes.

Mounting Legal Challenges and Regulatory Scrutiny

AmeriPlan’s troubles began in earnest as consumer complaints piled up with state attorneys general and the Better Business Bureau. The core allegations were consistent: misleading marketing, undisclosed limitations, and provider network issues. Customers reported signing up after being told the plan was “just like insurance” or that it covered major procedures, only to find their local dentist was not in the network or that the discounts were not as advertised. Other complaints involved difficult cancellation processes and continued billing after cancellation.

The legal response was swift and severe. In 2006, the Texas Attorney General sued AmeriPlan, alleging deceptive trade practices. The lawsuit claimed the company misrepresented its plan as health insurance, exaggerated savings, and failed to disclose that its provider network was sparse in many areas. This case set a precedent. More states followed suit. In 2011, the State of Illinois obtained a court order requiring AmeriPlan to pay over $1 million in restitution and penalties. The company was also ordered to clearly disclose in its marketing that it was not an insurance provider.

Perhaps the most damaging blow came from the Federal Trade Commission (FTC). In 2011, the FTC filed a lawsuit against AmeriPlan and its related corporate entities. The FTC’s complaint was comprehensive, alleging that AmeriPlan operated as an illegal pyramid scheme. The FTC argued that the company’s compensation plan was fundamentally structured to reward recruitment over the sale of products to real customers. The complaint stated that the vast majority of representatives earned little to no money, while a small fraction at the top reaped significant rewards from the fees paid by those below them. This is a key indicator of a pyramid scheme, where money flows from new recruits to earlier participants rather than from the sale of goods or services to the public.

The Final Chapter: Settlements, Bankruptcy, and Dissolution

Facing immense legal pressure from multiple states and the federal government, AmeriPlan could not sustain its operations. The company entered into a settlement with the FTC in 2012. While the settlement did not include an admission of guilt, it imposed a massive $169 million judgment against the company. More importantly, it banned the company’s owners, David and Jerri Clark, from any involvement in multi-level marketing or discount medical plan businesses in the future. This effectively ended AmeriPlan’s ability to operate under its original leadership and structure.

The financial weight of the judgment and ongoing legal costs proved insurmountable. AmeriPlan USA, the main corporate entity, filed for Chapter 7 bankruptcy liquidation in 2013. This process involved selling off remaining assets to pay creditors, though given the size of the FTC judgment, it is unlikely many consumers received restitution. The company’s provider networks were dissolved, and its website and customer service lines eventually went offline. While some residual entities or successor companies with similar names may have briefly appeared, the original AmeriPlan corporation ceased to exist.

Lessons for Consumers: Discount Plans vs. Health Insurance

The story of what happened to AmeriPlan serves as a vital consumer protection lesson. The central confusion between discount plans and insurance remains a problem in the market today. When evaluating any healthcare product, understanding the difference is non-negotiable.

True health insurance involves a contract where the insurer pays a portion of your covered medical costs after you meet your deductible. It is regulated by state insurance departments and must comply with laws like the Affordable Care Act (ACA), which guarantees coverage for pre-existing conditions and essential health benefits. Premiums are often higher, but they provide financial protection against catastrophic costs.

Discount medical plans are simply membership clubs that negotiate rates. They do not pay any claims. Their value depends entirely on two factors: the depth of discounts and the breadth of the provider network in your area. They are not regulated as insurance, meaning they have no obligation to cover specific conditions or services. Before considering such a plan, you must conduct thorough due diligence.

Key steps to take before enrolling in any discount plan or alternative health product include the following.

• Verify it is not insurance: The marketing materials should clearly state “This is not health insurance.” If you are unsure, contact your state’s Department of Insurance.
• Check the provider network: Contact your current doctors, dentists, and local hospitals directly to ask if they accept the specific discount plan. Do not rely on the plan’s online directory, which may be outdated.
• Understand the real costs: Calculate the monthly membership fee plus the discounted price you would pay for your typical care. Compare this to the premium and copay of a real insurance plan or the cash price you might negotiate directly with a provider.
• Research the company: Look for complaints with the BBB, your state Attorney General’s office, and the FTC. Search for news articles about lawsuits or regulatory actions.
• Review the cancellation policy: Understand how to cancel and whether there are any penalties or ongoing billing commitments.

For comprehensive information on understanding different types of coverage and avoiding misleading products, a resource like Read full article can provide valuable guidance. The legacy of AmeriPlan underscores the importance of this research.

Frequently Asked Questions About AmeriPlan

Can I still use my old AmeriPlan membership?
No. With the company’s bankruptcy and dissolution, any membership is void. There is no active provider network, and no entity is honoring those old memberships. If you are being billed for an AmeriPlan membership today, it is likely a scam, and you should contact your credit card company and the FTC.

Did anyone get their money back after the lawsuits?
While the FTC settlement included a judgment for consumer redress, the company’s bankruptcy meant there were insufficient assets to pay it. The FTC often attempts to get money back for consumers, but in this case, it is highly unlikely any former members received restitution. The primary outcome was shutting down the operation.

Are there legitimate discount dental or medical plans?
Yes, there are legitimate DMPOs that operate transparently. Major companies like Careington or Aetna Dental Access offer discount plans that can provide value for uninsured individuals who need basic care. The key is transparency: they must clearly state they are not insurance, provide accurate network information, and not use deceptive marketing or pyramid-style compensation for salespeople.

What is the best alternative for affordable care if I cannot afford insurance?
Options include shopping for a subsidized plan on the Health Insurance Marketplace (Healthcare.gov), where you may qualify for premium tax credits based on your income. You may also be eligible for Medicaid. For dental care, consider dental schools, community health centers, or local clinics that offer sliding-scale fees based on income. These options provide real care, not just a discount on a bill you still must pay in full.

How can I spot an MLM pyramid scheme disguised as a health product?
Be wary if the sales pitch focuses more on the income opportunity from recruiting others than on the product’s details. High pressure to join as a “business owner,” complex compensation plans heavily weighted toward recruitment bonuses, and a lack of clear retail customer focus (outside of the recruited salesforce itself) are major red flags.

The demise of AmeriPlan is a cautionary tale about the intersection of healthcare, multi-level marketing, and consumer vulnerability. It highlights the need for regulatory vigilance and, most importantly, informed consumers. In an era where healthcare costs continue to rise, the appeal of an affordable alternative is powerful. However, true financial protection comes from understanding what you are buying, reading the fine print, and verifying claims independently. The search for affordable care should lead to reputable insurance carriers, government marketplaces, and community health resources, not to companies that blur the line between a discount club and a get-rich-quick scheme. The story of what happened to Ameriplan reminds us that if an offer seems too good to be true, especially in the complex world of healthcare, it almost always is.