Some programmers advertise SEO into the cost of developing a website, and then don't add any extra costs monthly.. does that mean they're really not doing anything for my website once its "complete"?
There are 3 main stages to any seo project, the first is keyword and competitor analysis, the second is on page optimisation, the third is back link building. Of course there is reporting, reviewing and updating the strategy throughout too.
What you have been told before is just the on page aspects, keyword to text ratios, using title tags, alt attributes etc. BUT if you have not done stage 1 in the first place, you (or they) are highly unlikely to get this stage right. They may well be doing something, but if it will be effective or not is another matter, as you could end up doing the work based on a particular keyword (or set of) which is to competitive for your budget, has decreasing search volumes or is just not what people look for.
The price of a campaign will also depend on the selected keywords, for example "insurance quotes" would cost a
huge fortune to get to the top of google, whereas "insurance quotes wiltshire" would be quite easy.
Just a word of warning as there are loads of people out there offering a substandard service, so don't believe anyone who promises you a top position for even a vaguely competitive keyword, especially for a low price, you would most likely just be throwing your money away. And do expect to see immediate results, many SEO's will try to blind you with science, but the reality is that you should see a consistent rise in rankings, on a month by month basis, if you don't, find a new company.