Media's Attack On ACA Ignores Consequences Of Underinsurance
Research ››› ››› JUSTIN BERRIER & THOMAS BISHOP
Media outlets have been promoting the stories of individuals whose plans are being canceled as a result of the Affordable Care Act. But many of those canceled plans offer an inadequate level of coverage, which carries many of the same risks as not having insurance at all.
Media Highlights Stories Of Health Insurance Plan Cancellations
CBS News: ACA Forces Consumers To Find New Plans "Even If They Don't Want Or Need The More Generous Coverage." An October 29 CBS This Morning segment reported that "hundreds of thousands of people [are] losing coverage" to get more comprehensive plans "even if they don't want or need" the additional coverage:
Obamacare forces them to drop many of their plans that don't meet the law's 10 minimum standards, including maternity care, emergency visits, mental health treatment and even pediatric dental care.
That means consumers have to sign on to new plans even if they don't want or need the more generous coverage. Industry experts say about half the people getting the letters will pay more -- and half will pay less, thanks to taxpayer subsidies. Levitt said, "The winners outnumber the losers here, but because of all the website problems, it's hard to find out who the winners are because they don't even know it themselves." [CBSNews.com, 10/29/13]
NBC Promotes Story Of California Woman To Highlight "Sticker Shock" Of ACA. The NBC Nightly News featured an interview with Deborah Cavallaro, who received a notice saying her current plan was being canceled and would be replaced with a plan with higher premiums:
PETER ALEXANDER (correspondent): But in Los Angeles, that isn't what Deborah Cavallaro is finding. A self-employed Realtor, she buys her own insurance. Cavallaro's provider recently sent her this notice, reading, "Because of the requirements of the new laws, we can no longer offer your current policy."
CAVALLARO: All I want is what I currently have. I want to keep my doctors, and I would like to have lower premiums.
ALEXANDER: The insurance company is offering her a new plan that would cost $484 a month versus her current $293 premium, a 65 percent increase. Why so much more? The Affordable Care Act requires that all plans include 10 essential health benefits, from maternity care to pediatric services.
The administration points out many people will get subsidies to help offset the higher costs. And most traditional employer-based and government plans, that roughly 80 percent of Americans rely on, will not be affected. [NBC, NBC Nightly News, 10/28/13]
Individuals Being Highlighted By Media Are Underinsured
Wemple: Woman Featured On CBS Had A "Pray-That-You-Don't-Get-Really-Sick" Plan. In a post on the Washington Post's Erik Wemple blog, Wemple noted that Dianne Barrette, a woman highlighted on a CBS report on plan cancellation, had coverage that would not have covered hospitalization and "could well have bankrupted" her:
More coverage may provide a deeper understanding of the ins and outs of Barrette's situation: Her current health insurance plan, she says, doesn't cover "extended hospital stays; it's not designed for that," says Barrette. Well, does it cover any hospitalization? "Outpatient only," responds Barrette. Nor does it cover ambulance service and some prenatal care. On the other hand, says Barrette, it does cover "most of my generic drugs that I need" and there's a $50 co-pay for doctors' appointments. "It's all I could afford right now," says Barrette.
In sum, it's a pray-that-you-don't-really-get-sick "plan." When asked if she ever required hospitalization, Barrette says she did. It happened when she was employed by Raytheon, which provided "excellent benefits." Ever since she left the company and started working as an independent contractor, "I haven't been hospitalized since then, thank God." Hospitalization is among the core requirements for health-care plans under Obamacare. [Washington Post, Erik Wemple Blog, 10/28/13]
Atlantic Wire: Barrette's Coverage Did Not Cover Basic Services. The Atlantic Wire found that the plan Barrette had did not cover most of the essential benefits laid out by the Affordable Care Act:
[T]he health care law that was passed in 2010 outlined 10 essential benefits every plan has to provide: "ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care," according to Healthcare.gov. So while you can probably keep your doctor, you can't keep you bare bones limited liability plan.
Barrette's plan didn't offer most of this. According to the same GoBlue summary mentioned earlier, and a GoBlue representative, her plan:
- Only paid "up to $50 per provider per date of service for covered services."
- Discounted medicines, but didn't cover them. "Contraceptives and self-injectable drugs are not covered. GoBlue pays up to $5 or $15 per prescription, depending on the plan purchased."
- Didn't cover maternity/pre-natal care or hospital visits. [The Atlantic Wire, 10/28/13]
Waldman: Woman Featured On NBC Report Likely Had Inadequate Health Insurance. In a post on The American Prospect, Paul Waldman pointed out that Deborah Cavallaro, the woman highlighted in the NBC report, likely had a plan that "barely deserved to be called insurance at all":
We learn in this story that her insurer is cancelling her current plan, which costs $293 a month, because it doesn't comply with the new law. They've offered her a new plan at $484 a month. That sounds like it sucks! But here are some things the story never tells us.
First, what exactly was her old plan? Deborah looks to be around 45. If she bought a plan on the individual market for $293 a month, I can guarantee you it barely deserved to be called insurance at all (I've bought insurance like this on the individual market). It probably had a deductible in the thousands of dollars and had substantial cost-sharing for any significant medical event. But the story doesn't tell us what sort of insurance she has. [The American Prospect, 10/29/13]
Underinsurance Carries Many Of The Same Risks As Uninsurance
KFF: Underinsurance Can Lead To Lack Of Care, Medical Debt, "Other Severe Financial Problems." In a post titled "The 'Underinsurance' Problem Explained," the Kaiser Family Foundation pointed out that lack of adequate health insurance can lead to poor health outcomes and financial problems:
Some of the underinsured avoid going to the doctor or getting prescriptions filled because they can't afford it. Others end up with medical debt and other severe financial problems.
Often, sicker or older (those just short of qualifying for Medicare) people are underinsured because they can't afford comprehensive coverage. One reason? Only 18 states limit how much insurers can base premiums on factors such as age, health status and gender. [Kaiser Family Foundation, 9/28/09]
Commonwealth Fund: Underinsured More Likely To Go Without Care, Experience Medical-Related Financial Stress. A report by the Commonwealth Fund found that the underinsured often experience the same low access to care and financial stress as the uninsured:
Access to Care
Relative to those with more adequate insurance, the underinsured were significantly more likely to go without care because of costs. In fact, they reported rates of cost-related, forgone care close to those of the uninsured.
More than one-half of the underinsured (54%) and uninsured (59%) went without needed care during the year: they failed to fill a prescription, skipped a test or follow-up, failed to visit a doctor for a medical problem, and/or did not get specialist care.
Levels of financial stress among the underinsured rivaled levels among the uninsured and were four times the rates observed among the more adequately insured. Nearly one-half (46%) of the underinsured were contacted by a collection agency for medical bills and more than one-third (35%) said they had to change their way of life to pay medical bills.
Inadequate coverage left those with health problems in double jeopardy: failing to get needed care and, at the same time, grappling with medical bills. These problems were most acute among adults with low incomes and adults with health problems.
Yet, even after taking into account differences in income, health, age, and other characteristics, the underinsured and uninsured were still significantly more likely to report access concerns and negative care experiences than those with adequate coverage. [Commonwealth Fund, 6/13/05]