But I felt that one of their points needed to be addressed because it could be a little misleading.  They note that 40% of Colorado residents have an income of less than $43,000 for a family of four, and that these families simply cannot afford health insurance, as the price of coverage for a family of four is “approaching $15,000″.  The authors note that families simply cannot afford to pay more than a third of their income for health insurance (I agree).  But that $15,000 figure is based on the cost of guaranteed-issue group health insurance.  Individual and family policies that are purchased without going through an employer are much less expensive.  And even when a family has group health insurance, the employer usually pays at least part of the premiums – it is rare to find a family that is actually paying $15,000 a year for their health insurance.  (People on COBRA are paying the entire cost of their group health insurance premiums, but they make up a small segment of the population).

My concern when I see articles noting that the cost of family health insurance is in the $13,000 – $15,000 range is that people might be so discouraged by those figures that they simply give up and opt to be uninsured without looking at what their options really are.  My husband and son and I will pay just over $4000 this year for our health insurance (we’re self-employed, so we pay the full cost of our health insurance ourselves).  True, we have a high deductible, HSA qualified policy that wouldn’t work for everyone.  But it’s perfect for us, and the premium is a fraction of the figure that often gets tossed around when people talk about family health insurance premiums.  If we opted for a more comprehensive policy with office visit copays and a lower deductible, we would still be paying roughly $7000 or so in annual premiums.

For families that are relatively healthy, there are lots of options for health insurance that they can purchase on their own.  The premium will likely be quite a bit less than the numbers that get mentioned in most articles that discuss the cost of health insurance.  I hope that people don’t see those numbers, assume that they can’t afford coverage, and give up without looking at all of their options.  We’re still three years away from most of the benefits of health care reform, and that’s a long time to be uninsured.

Most of our health care industry (including private health insurance) is profit driven.  This is the case with most private industry in the US, and for many of them, it’s a good model.  It drives innovation, fosters competition, and spurs our economy.  But one has to wonder if health care might be different (and should thus be treated differently) from other industries.  There aren’t many other industries where one’s very life may depend on  being able to afford a certain product.  But we know that people who are uninsured are more likely to die than their insured neighbors.  A person with cancer who isn’t able to pay for treatment has a pretty grim prognosis when compared with another person with the same cancer and a good health insurance policy.  In my opinion, this sets health care in a category apart from material things like cars and clothing.

Even shelter – undeniably necessary when temperatures drop below zero the way they have in much of Colorado this week – can be found on many different scales.  A person can escape the cold in a mansion, mobile home, public housing, or even shelters – all will protect against the elements.  But a person with kidney failure needs dialysis, and a person with type I diabetes needs insulin… no matter what their financial status might be.  Health conditions are a good equalizer; people get sick regardless of their ability to pay for care.

We’ve discussed how health insurance – especially in the individual market – isn’t really a good example of a free market commodity.  People with serious health conditions simply can’t purchase private individual health insurance in most states.  But we often find that people are unaware of this fact if it doesn’t impact them or someone they know.  People who are covered by an employer plan, or who are healthy enough to get an individual health insurance policy, might think that things are just fine as they are.  And sometimes those people will comment that government should stay out of free market affairs.  But then that person will get an annual premium increase of 25%, or be declined for coverage by a private insurance company, and their question for us will be something along the lines of “is that legal?”

Basically, we can’t have it both ways.  If we want smaller government, we have to accept that it comes with fewer regulations.  And that means more control in the hands of industry and less in the hands of consumers.  If we want regulation over things like premium increases and pre-existing condition limitations, we have to accept that it means more government intervention.  In the case of health care and health insurance, we’ve obviously got some flaws in our current system.  In some states, a person without access to an employer-sponsored health insurance policy cannot get coverage at all.  That is a problem any way you look at it.

Yes, some of the problems stem from personal irresponsibility (although hopefully mandatory health insurance will help to address this issue).  But some of the problems are built into the health care system, and that is why reform in the shape of government intervention is such an important task.  Because a consumer versus an industry isn’t really a fair match-up.

I found Joe’s article in the Health Wonk Review, hosted at Workers’ Comp Insider.

On several points, I agree with Bob.  There are a lot of ideas in the reform proposals (like maternity care on all policies, guaranteed issue coverage, and limits on premium variation with age, for example) that sound good, but are tough to afford.  And Bob is correct in noting that in states where health insurance is already guaranteed issue, premiums for individual policies are much  more expensive than in states like Colorado, where we have medical underwriting.  Simply expanding access to health care without significantly impacting the underlying cost issues isn’t going to fix anything.

In the discussion about guaranteed issue health insurance, Bob mentions that:

“Pious platitudes but this demonstrates how little the good doctor actually knows about the current system. Every state has provisions that allow access to health insurance on a guaranteed issue basis.  Every one.  Yet this fact is ignored over and over.”

It is true that HIPAA provides some access to guaranteed issue health insurance in all states, since it’s a federal regulation.  But HIPAA eligibility is limited to people who have had at least 18 months of group health insurance coverage (and elected and exhausted COBRA if it was available), and who have been uninsured for no more than 62 days.  That means that a person who has been uninsured for more than a couple months is out of luck, as is anyone who didn’t have prior group coverage.

In a few states, health insurance is guaranteed issue for everyone (and quite expensive).  In the rest of the country, for those who can’t get health insurance under HIPAA regulations, there are high risk pools in many states.  But there are a handful of states that don’t have any sort of guaranteed issue health insurance for people who aren’t HIPAA eligible.  To verify, I contacted the Divisions of Insurance in several of these states (AZ, FL, DE, NV, and HI) and was told that none of them have any sort of guaranteed issue individual health insurance.  The HI representative mentioned that they have an employer mandate that requires employers to provide health insurance for any employee working at least 20 hours a week, so that likely solves the problem for most people there.  But in the other four states, according to their Insurance Commissioner’s office, there are no options for people who can’t qualify for individual health insurance.  One representative told me that people just have to “keep trying” for individual health insurance.

We’re lucky to have Cover Colorado, a high risk pool policy, which provides fairly good coverage with reasonable rates.  But even with a good program in place, there are still people who fall through the cracks.  Cover Colorado requires an applicant to have lived in Colorado for at least six months before being eligible for a policy (unless the applicant is transferring from another state’s high risk pool).  We have spoken with clients over the years who have moved to Colorado only to find out that they will have to go uninsured for six months before becoming eligible for coverage (which means that once they do become eligible, they will be subjected to a pre-existing condition limitation because they have a gap in coverage).

High risk pools are definitely better than nothing, but they don’t solve all insurance problems for people who have pre-existing conditions, and they don’t exist at all in some states.  One of the aims of reform ought to include truly making health insurance available – in all states – to all applicants who want to purchase it.  If we make all health insurance policies guaranteed issue (without also significantly expanding the pool of healthy insureds via a strong mandate), we’ll likely see higher costs for all insureds.  But a good start would be to make sure that everyone, regardless of where they live, has access to at least one guaranteed issue health insurance policy (and no, discount plans and limited benefit policies don’t count).

I found Bob’s article in Grand Rounds, hosted this week at Healthcare Technology News.

1.  It’s important to know that each health insurance carrier has its own underwriting guidelines.  Just because you’ve been declined by one carrier, does not necessarily mean you’ll be declined by all of them.  We can give you an idea – based on your specific health history – of whether you might have better luck with a different carrier.

2.  Cover Colorado is available for most people who have been declined by a private health insurance carrier.  Cover Colorado is the state high risk pool, and has been providing health insurance for people with pre-existing conditions since 1991.   They offer premium discounts if your household income is below $50,000/year.  Applications must be received by the 15th of the month in order to qualify for a 1st of the following month effective date.

3.  Are you self-employed?  You may qualify as a business group of one.  You must have been in business for at least one year in order to qualify as a business group of one.  The state mandated Basic and Standard health insurance plans are guaranteed issue for a group of one during specific open enrollment periods, defined as 31 days from one of the following events:  the one year anniversary of the opening of your business, your birthday, or the loss of other coverage.  You can contact the Colorado Division of Insurance for more information about group of one regulations.  Like most group policies, group of one coverage is more expensive than most individual policies.  The notable exception is in the case of large families.  Individual health insurance premiums are calculated on a per-person basis, whereas group premiums have “family” rates that don’t vary with the number of children.  Group of one policies are offered by all carriers that offer group health insurance policies in Colorado.  The state mandated benefits in the Basic and Standard plans are the same regardless of what carrier you choose, but the price varies from one carrier to another.

4.  Have you recently left a job?  You may qualify to continue your coverage under COBRA or Colorado state continuation regulations.  COBRA applies to people who worked for a company with 20 or more employees, while state continuation applies to people who worked for a company with 2 – 19 employees.  In both cases, you’re allowed to continue your group coverage for up to 18 months (or more, depending on some specific circumstances), but you will be required to pay the entire premium, including the portion that your employer was paying on your behalf.  If you’re covered under COBRA regulations, you have 60 days to elect to continue your policy after you leave your job.  In the case of state continuation (if you were working for a company with fewer than 20 employees), you have 30 days to elect to continue your coverage.

5.  Depending on your income, and several other factors, you or your dependents may qualify for Medicaid.  In addition, children and pregnant women in Colorado may qualify for Child Health Plan Plus (CHP+) if their household income is less than 200% of the federal poverty level.

6.  Do you work for a small company that does not provide health insurance?  You could discuss the issue with your employer, and see if you can convince them to enroll in a small group plan.  Groups of 2 – 50 employees are guaranteed issue in Colorado, and with the passage of HB 1355, small group premiums cannot be adjusted either up or down during enrollment based on the medical history of the group members.

Thankfully, we live in a state where there are several options for people who are unable to qualify for private individual health insurance.  This is not the case in all states, although maybe the ongoing health care reform debate will eventually add options where there currently are none.

In addition to the workers who were laid off prior to the September 1, 2008 cutoff, there are plenty of others who won’t be getting stimulus assistance when it comes to health insurance.  People who worked for a company that went out of business (or stopped offering health insurance for whatever reason) won’t qualify, because there won’t be a health insurance policy for them to opt to continue via COBRA.  In addition, people who were laid off from small businesses might not qualify if their state doesn’t have a “mini-COBRA” law allowing workers to continue coverage when they leave groups with fewer than 20 employees (federal COBRA regulations apply to groups with 20 or more employees).  Colorado’s Mini-COBRA regulations allow an employee of a small business to continue coverage for up to 18 months, but there are several states that only allow for a few months of continuation – far less than the employees would qualify for if they had worked for larger companies.  Some states have been taking action over the last few months to make sure that workers laid off from small businesses are eligible for the federal COBRA assistance program, but there are still 12 states that don’t have mini-COBRA laws (so residents of those states who were laid off from businesses with fewer than 20 employees won’t see any benefit at all from the COBRA assistance program, since they aren’t eligible for COBRA).

Nobody ever said life was fair, but this situation seems particularly unfair.  I know that money is tight for the government right now, but I think that it would make things a little more fair if they were to expand the subsidy program to include subsidies for individual health insurance premiums (or state risk pool policies) for workers who were laid off before September, and for those who aren’t eligible for COBRA.

For starters, the beneficiaries are individual people, not corporations.  The health insurance provision in the stimulus package will allow the government to pay for 65% of the COBRA health insurance premiums for people laid off between September 1, 2008 and December 31, 2009.  The assistance will continue for up to nine months.

Another plus is that the provision only applies to people who were laid off – not those who left voluntarily.   So it is clearly aimed at helping people who have been directly impacted by the recession.   There is an income limit of $125,000 for an individual and $250,000 for a married couple who file a joint tax return.   People who have been laid off and are job hunting and/or receiving unemployment benefits will probably fall well under these limits, so the income cap probably won’t have much of an impact.  Personally, I’d prefer to see it be a little lower.  Families USA pegs the average COBRA family health insurance premium at $1069/month, which is a considerable sum of money.  But it seems that a family earning $249,000/year should be able to pay the premiums without assistance.  That’s my only complaint about the health insurance assistance provision in the stimulus package, and as I mentioned, most recipients are likely to fall well below that income mark anyway.

We frequently talk with clients in Colorado who are trying to decide between continuing their group health insurance policy through COBRA or getting an individual health insurance policy on their own.  For people who know they’ll be needing to get their own health insurance long term, an individual policy makes sense.  But for people with health conditions, COBRA is often the best (sometimes only) option.  Until they get the paperwork and see how much it’s going to cost.  The stimulus bill will now make it a more affordable option for people who have been laid off.  The number of Americans without health insurance is already way too high.  And since most people get their health insurance from an employer, the rising unemployment numbers were sure to drive the number of uninsureds higher.  Hopefully the stimulus bill will help to mitigate the problem for a while.  And hopefully the economy will get back on track by the end of the year when the government assistance program is scheduled to end.

Here in Colorado, I spoke with a client recently who got a quote for $1450/month to continue her family’s health insurance through COBRA.  She pointed out that this was quite a bit more than her mortgage payments, and was completely impossible for her family.  Luckily her family is healthy and can qualify for individual health insurance, which will be far less expensive.

COBRA is still a beneficial law that (in theory) protects access to health care.  But when it comes time to sign and return the paperwork to continue coverage, most people realize that there just isn’t room in the budget.  This is especially true for workers who have been laid off and are struggling to make ends meet.  Unemployment numbers are heading steadily in the wrong direction (in Colorado, unemployment hit 6.1% in December, the highest it’s been in five years).  I’ve seen lots of conflicting reports about the economic stimulus bill and whether the final version (if passed) will contain relief for unemployed Americans struggling to pay for health insurance under COBRA.  Without such a measure, the number of uninsureds will likely be higher this year than ever before.

Thanks to Health Business Blog for hosting last week’s Health Wonk Review, where I found the article from Health Populi.

I was struck by how similar this plan sounds to the high risk pool we have here in Colorado.  Cover Colorado has been open to participants since 1991, and it has been remarkably consistent.  Of course there have been rate increases, but that has been the case with all of the private health insurance carriers too.  Cover Colorado does cover maternity, with most of the plans covering prenatal visits with just a copay, and the delivery is covered at the coinsurance rate after the deductible is met.  The maternity coverage is similar to many private group health insurance policies, and is an obvious advantage over individual health insurance plans, very few of which cover maternity at all.

In Colorado, eligibility for Cover Colorado can be triggered by a declined application from a private health insurance carrier, or by an offer of a policy with a premium that is higher than Cover Colorado’s premium, or by an offer of a policy with a pre-existing condition exclusion.  Applicants must not be Medicare or Medicaid eligible, and must not be eligible for a group health insurance policy or COBRA.  Basically the plan is set up to be as inclusive as possible, while still being an option of last resort.

In the 17 years that Cover Colorado has been available here, I would not say that we have seen a flocking from private group health insurance to high risk pool coverage.  In 2007 (the most recent data I could find), there were 5,414 people insured by Cover Colorado.  Compared with the 17% of our state’s population that is uninsured, the number of people covered by our high risk pool is a drop in the bucket.

When employers stop offering group health insurance policies (which we may well see next year, as HB1355 takes effect and healthy groups are no longer eligible for a premium discount), the employees have a few options.  If they are healthy, they can apply for individual health insurance and choose from among numerous private carriers offering hundreds of policy options.  If they have pre-existing conditions, they can still apply for individual health insurance, but they may end up with a policy that excludes pre-existing conditions, or one that charges them a higher rate in trade for covering the pre-existing condition.  If they are unhappy with the offer they receive, or if they are declined, they can apply for Cover Colorado.  But the premium is steep.  A non-smoking 35 year old female will pay more than $400/month for a policy with a $1000 deductible (rates vary by county, and discounts are available to people with household incomes below $50,000).  There are plenty of Colorado residents who can’t afford premiums on private, medically underwritten policies, much less high risk pool rates.

If NC is efficient in the management of their high risk pool, I see no reason why it won’t be successful long-term.  But the high premiums (from Hank’s article, it sounds like they’re even higher than Cover Colorado) will likely be a stumbling block for a lot of people.  Those who are currently experiencing costly medical bills will find a way to pay the premiums.  But people who have been declined for health insurance because of a condition that is not currently costing them money might be less inclined to do so.  And going uninsured means that if (when) they do run into an expensive medical problem in the future, they will be out of luck, as the high risk pool will enforce a waiting period on pre-existing conditions.  So even with high risk pools, we find ourselves in a situation where people are uninsured and lacking realistic access to health care.  As long as we continue to have an opt-in/opt-out health insurance system, this problem isn’t likely to be solved by high risk pools.

I am paying COBRA, health and dental at $640. per month.
I am a nurse, recently diagnosed with cystic fibrosis (CF) at age 50, this year.
Cobra is 18 months with 11 month extension. I was informed I have to exhaust COBRA timeline before being eligible for Cover Colorado, the High Risk Pool.
CF is a respiratory illness that uses the same meds as any other respiratory disease. Nat’l Jewish sees patients a minimum of 4x per year, more if other symptoms occur as in diabetes.
Asthma patients use nebulizers just as CF pt’s do.
Tobramycin for pseudomonas is inhaled for CF pt, It’s an available medication. Therefore, if you have a non CF patient that has pseudomonas in their lungs, the treatment is the same. I don’t understand why CF has to be in the high risk pool. All other symptoms related would need to be treated at any other hospital. Additionally, CoverColorado is still more expensive for women/non smokers at age 50 than it is for men. We still make less in the workforce and have to pay more for health insurance. after age 50, women are nonchild bearing. So, why is there unequal costs. Also, CF at age 50 is definitely a shorter life span and I would probably need health insurance as long as 5-8 years. I’m paying for COBRA mostly because I need health insurance to “qualify” for future policies and exclusion waiting periods and in case I need it for non CF injuries/illness. I get my medications via the VA at no cost. Currently, I use Denver Health pharmacy or VA which lowers my out of pocket expenses. I think my insurance costs should be lower because of VA benefits. Would someone please address these concerns. Thank you so much. J.A., RN

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But why are employers involved in health insurance at all? Is it just tradition? Are we still working with the same mold that was created half a century ago, when employees tended to work at the same place for 40 years and were then rewarded with a pension for the rest of their days? If we really stop and think about it, why are health insurance and retirement funds linked to employers? In the 21st century, employees change jobs and even careers multiple times over their working years. Some people do still stay with the same employer for a lifetime, but it’s not the norm anymore.

When you retirement plan is linked to your employer – as is the case for all the 401k plans out there – and you leave your job, you can just roll your plan over to the one your new employer offers, or you can convert it to an IRA on your own. But if you have employer-sponsored health insurance and you leave your job, the options are not so simple. Yes, you can take COBRA (if you can afford it), but that’s only good for 18 months. After that, you either have to have health insurance in place through a new employer, or get individual coverage on your own. But if you have pre-existing medical conditions, your options are limited. You may not qualify for individual health insurance at all. If you live in a state with high-risk pool health insurance – here we have Cover Colorado – you’ll be able to get health insurance, but it may be very expensive and have a lot more out-of-pocket than you’re used to. If your state has no risk pool, you might just be out of luck unless you get another job that offers health insurance.

Wouldn’t it be simpler for everyone if “individual” insurance were really a group made up of everyone in a state, or even the whole country? What if every Colorado resident could be covered by a range of health insurance plans similar to what is available today in the group and individual market, but without any employer affiliations required? People would be covered continuously, regardless of their employment situation, and would not be trapped in a job just for the health insurance benefits.

To me, employer-sponsored health insurance was a better idea a generation ago than it is today. People are much more mobile today, and need a health insurance plan that is truly portable and not linked to where they live or what job they do.