Even Those WITH Health Insurance will Benefit from National Health Reform

Andrea arrived home to an unwelcome surprise. Her insurance company sent her a letter explaining that the doctor who treated her son in the NICU was not a part of the provider network. Despite the urgency of her son’s condition and the fact that she was not given a choice of which doctor would treat her son in the NICU, the insurance provider refused to pay for the bulk of the NICU doctor’s charge of $1,145.

I just couldn’t believe that something like this was allowed to happen in America, we spend close to 25 percent of our gross income on total medical expenses a year, and it’s just getting more and more expensive every year.  At some point people aren’t going to be able to afford it.

In the end, the doctor gave Andrea a 50% discount on the amount she owed.  Shortly after, she was slammed once again with expensive out-of-network doctor fees when she had to take her infant son to the emergency room.  This time she got a bill for $600, of which the insurance company would only consider paying $200.  Because Andrea had not met her annual deductible at that point, she had to pay the full $600, and the insurance company only credited $200 of it toward her deductible.

Andrea filed appeals to her insurance company both times she was hit with unexpected out-of-network bills. All of her appeals were denied.

Concerned about future emergency visits, Andrea asked her insurance provider to clarify where she should take her son if he required urgent care.  She was told that no emergency room doctor in the entire state of Texas was in her plan’s network. She says of this revelation, “I just couldn’t believe that something like this was allowed to happen in America.”

Andrea’s family spends more than $7,000 a year on their health care premiums. She thought insurance would protect her household from crippling out-of-pocket health costs, but they currently pay close to 25 percent of their gross income on medical care expenses. With the rising costs of health care, Andrea worries about the point where her family will not be able to afford to pay for care.

How the Current System Fails People with Coverage like Andrea

• All too often, patients are unexpectedly hit with big bills for out-of-network charges that are beyond their control.  Even when patients are careful to go to a network hospital, they may be treated by non-network ER doctors, anesthesiologists, or other providers.
• Often, when a consumer appeals an insurance company decision, insurance policy provisions allow the insurer to be the final judge on the matter, even though the insurer has a financial stake in the outcome.
• Having insurance does not necessarily mean you will be able to afford the health care you need.  Many health insurance policies have high deductibles, expensive prescription drug copays, etc., leaving families with coverage exposed to significant out-of-pocket costs.
• Having insurance does not necessarily mean you have protection from financial ruin in the case of serious illness.  More than 60% of bankruptcies are due to medical problems, and of those, 75% had insurance when they got sick.

Health reform will help ensure that an insurance policy covers what you need and does not leave people exposed to huge medical costs, providing more economic security for families like Andrea’s.

Top 3 ways health reform will help families like Andrea’s:

1. Provider network standards. Health insurance sold in the Health Insurance Exchange (http://www.kff.org/healthreform/7908.cfm )  will be required to offer an adequate provider network as defined by the Secretary of Health and Human Services. This focus will hopefully ensure that no policies are sold through the Exchange that have no ER doctors in-network in the whole state.
2. Stronger appeals process. Health insurance companies will be required to have an effective internal appeals process, as well as an external (independent) appeals process that meets consumer protection standards.  Health reform makes grants available to states to establish an Office of Health Insurance Consumer Assistance or Health Insurance Ombudsman, that among other important functions, will assist consumers with filing appeals and complaints.
3. Capped exposure to out-of-pocket costs and affordable coverage. Health reform caps the amount of exposure families at all income levels will have to out-of-pocket costs.  On top of that, for low- and moderate-income families, premiums and out-of-pocket costs in Exchange coverage will be reduced on a sliding-scale.