The tens of thousands of Pennsylvanians who recently received cancellation notices from their health insurers are understandably worried. Few know that feeling better than 41,000 Pennsylvanians who saw their adultBasic coverage cancelled two years ago. The key difference: most of those who lost adultBasic weren’t able to find other coverage as insurers could still deny coverage to people with pre-existing conditions, charge high rates for skimpy coverage, and restrict care by placing lifetime and annual limits on coverage.
Those who lost adultBasic didn’t have access to tax credits to reduce their monthly premiums, or cost-sharing help to cut their out-of-pocket costs, as most of those receiving cancellation notices will, by getting a plan in the Health Insurance Marketplace under the Affordable Care Act (ACA).
The two situations are not directly comparable, but there are some important lessons learned from this experience:
If the federal government is going to make people buy health insurance, it needs to make sure the insurance is worth buying.
That means covering important benefits—like penicillin to fight infection or antihypertensives to decrease blood pressure. Some plans do not provide this type of coverage.
AdultBasic participants learned this lesson the hard way. Two years ago, Blue Cross Blue Shield companies allowed terminated adultBasic participants to join Special Care, a low-cost limited benefit insurance product. But those Special Care plans charged premiums 400% higher than adultBasic (or $140 per month as opposed to $36), provided far fewer benefits and limited doctor’s office visits to four times a year!
You read that right. A plan that limits members to four visits in twelve months?! That can be used up with one minor illness. From this vantage point, allowing insurers to offer products with diminished benefits for another year is a step backwards.
Insurance companies should have to explain how the old plans differ from ACA-compliant plans.
People need to make informed comparisons. Too many former adultBasic enrollees pay Special Care’s high premium, unaware of its limited benefits.
Kaiser Health News profiled Paula Michele Boyle and her husband Tom, both self-employed cancer survivors who need regular medical care, and moved to Special Care after adultBasic closed. They pay about $300 a month for coverage. The couple earns about $25,000 per year. But the limited coverage provided by Special Care is "not covering our needs," she says. Her husband needs surgery for a shoulder injury but has postponed it in the hopes that they might be able to find more comprehensive coverage. "We're sweating out at this point," she says. "We're still in a really tough spot."
State officials should send notices to ALL former adultBasic enrollees and the 500,000 on the waiting list when adultBasic ended, reminding them that they can secure coverage through the Health Insurance Marketplace.
Households like the Boyles need to know that in ACA compliant plans, private health insurers cannot discriminate. They cannot charge higher prices, withhold benefits, or deny coverage to people who represent medical risks.
Plans that fall below ACA standards should not be marketed to low-income households.
At a minimum, Pennsylvania’s Insurance Department should eliminate existing individual plans with low-income eligibility requirements. Compared to Special Care, the new health insurance plans are more affordable and provide far better benefits. Keeping the old will create confusion when people get sick and face huge medical bills.
The one exception is that non-compliant plans seem to be the only option for very poor Pennsylvanians (approximately 300,000) who earn below the federal poverty level. That’s because the ACA does not provide health insurance subsidies for anyone below the poverty line. With Pennsylvania not yet ready to expand Medicaid coverage, low-income individuals are left with few choices. Like the 15,000 former adultBasic participants who enrolled in Special Care plans two years ago, despite Special Care’s limitations and expense, there is nothing else.
Until Governor Corbett acts to expand coverage, 300,000 very poor Pennsylvanians will be forced to pay more and put up with less. That’s a shame. You shouldn’t be too poor to get decent health insurance.
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