Bullshit. I have individual insurance and it does NOT work like car
insurance. I pay the same as everyone else in my age group and health level
regardless of what I develop after I have the policy. While the premiums
increase each year at my annual renewal due to my age, it is against the law
in my state for them to penalize me for making claims. All they can do is
put people in a riskier level for pre-existing conditions. For example:
when I first purchased my policy, I was a level 3 due to an injury within
the past 12 months. A year later, I renewed as a level 2 at a cheaper
premioum (injury within past 24 months) and again 2 years later as a level 1
(even lower premium) since I had no problems in that time. Now that I am a
1, they cannot downgrade me if I renew each year regardless of what
problems I develop - even chronic ones.
Then you're lucky to be in a 'big government' state where government tightly
regulates free market insurance. Most Americans aren't so lucky. But you're
still taking a hugh risk because if you develop a chronic condition they will
figure out some way to stick it to you or cancel your policy sooner or later.
If nothing else they will just pull out of the your market for a year
when they get too many unprofitable policies. Like all the people who
erroneously thought their insurance would pay for the hurricane damage to their
houses, you have a false sense of security. When you find out you aren't as
protected as you thought, it will be too late and you will be screwed. Group
insurance is the only serious insurance in America.
But in America even having group insurance is no guarantee you're safe, while
individual insurance is an order of magnitute more risky.
------------------------------------------------------------------------
October 23, 2005
New York Times
Being a Patient
When Even Health Insurance Is No Safeguard
By JOHN LELAND
CAMBY, Ind. - Until the fourth trip to the hospital in 1998, Zachery
Dorsett's parents thought their son was an average child who was having
trouble getting over a passing illness. He was 7 months old, and it was
his second case of pneumonia.
The Dorsetts, Sharon and Arnold, were concerned about Zachery's health,
but they were not worried about the financial consequences. They were a
young, middle-income couple, with health insurance that covered 90
percent of doctors' bills and most of the costs of prescription drugs.
Then the bills started coming in. After a week in the hospital, the
couple's share came to $1,100 - not catastrophic, but more than their
small savings. They enrolled in a 90-day payment plan with the hospital
and struggled to make the monthly installments of nearly $400, hoping
that they did not hit any other expenses.
But Zachery, who was eventually found to have an immune system disorder,
kept getting sick, and the expense of his treatment - fees for tests,
hospitalizations, medicine - kept mounting, eventually costing the
family $12,000 to $20,000 a year. Earlier this year, the Dorsetts
stopped making mortgage payments on their ranch house, in a subdivision
outside Indianapolis, because they could not afford them. In March, they
filed for bankruptcy.
"Zach was really mad at us when we told him we were going to lose the
house," Mrs. Dorsett said. "We told him we had to make a choice: whether
to pay for medical bills or the house."
She added: "I didn't want the kids to hate their father for working all
the time, but I also didn't want them to think we were irresponsible. I
was worried about Zach feeling guilty or his sister blaming him that she
has to leave her friends. But whatever we gave up is a small price to
pay for his health."
Never have patients had so many medical options to extend, enrich or
alter their lives. But these new options are expensive, and with them
has come a change for which many Americans - even those with health
insurance - are financially ill prepared.
After decades in which private and government insurance covered a
progressively larger share of medical expenses, insurance companies are
now shifting more costs to consumers, in the form of much higher
deductibles, co-payments or premiums. At the same time, Americans are
saving less and carrying higher levels of household debt, and even
insured families are exposed to medical expenses that did not exist a
decade ago. Many, like the Dorsetts, do not realize how vulnerable they
are until the bills arrive.
Lawyers and accountants say that for the more than 1.5 million American
families who filed for bankruptcy protection last year, the most common
causes were job loss and medical expenses. New bankruptcy legislation,
which went into effect Oct. 17, requires middle-income debtors to repay
a greater share of their debt.
The Fight for Solvency
The Dorsetts' filing came after years of accumulating relatively modest
bills, often just co-payments on doctor visits or prescriptions. Almost
since Zachery's birth, they had finished each year with more credit card
debt than they had the year before. Even when they took out a second
mortgage to pay off their credit cards, by the end of the year they were
in debt again, with higher mortgage payments. And each year, their
projected expenses were greater.
On a late summer morning, Mrs. Dorsett, now 32, sat with her son in Room
4013 at St. Vincent Children's Hospital in Indianapolis as a colorless
infusion of immune globulin, a treatment made from blood plasma, dripped
slowly into his left arm, supplying the antibodies that his immune
system does not produce.
The monthly infusion, which has become a regular part of his childhood
along with soccer practice and family camping trips, costs $54,000 a
year, of which the Dorsetts will pay more than $5,000.
"My friends don't understand it," Mrs. Dorsett said, looking back at the
family's relentless, inevitable process of insolvency. "They think, How
could it get so bad so quick? Unless you have a sick kid, you don't know
what it's like."
For the Dorsetts, this is what the end looked like, according to the
family's bankruptcy filing: They had $1,431 in their checking and
savings accounts; they owed $29,146 on various credit cards; and after
refinancing their house to pay down their credit cards, they could no
longer afford the payments on their house or car.
Mr. Dorsett, who works on commercial heating and air conditioning
systems, sometimes stitching together 90-hour weeks, earns $68,000 a
year. It is more money than his father ever made, but not enough to
cover the bills, especially with the monthly infusions starting.
Mrs. Dorsett recounts the impact their medical expenses have had on the
family: They buy their clothing at yard sales, and skip vacations and
restaurant meals. Mr. and Mrs. Dorsett argue, like many couples, mainly
about money. Mr. Dorsett has had to work nights and weekends, with
little contact with his wife and children; Mrs. Dorsett has tried to
create a home for the children.
"We don't live a frivolous life, but I need to make my kids' life
normal," she said. "They still need bikes. My husband says, 'Kids in the
third world don't have those things.' I say, 'We don't live in a third
world country.' "
As the bills mounted, it was Mrs. Dorsett who forced her husband to
acknowledge that he could not simply work more hours. "I showed him,
even if I went back to work, we'd still be in debt in 10 years," Mrs.
Dorsett said. "Our kids could not go to college."
In a study of 1,771 people who filed for bankruptcy, reported this year
by four researchers at Harvard and Ohio University, 28 percent said the
cause was illness or injury. Most were middle class, educated and had
health insurance at the start of the treatment. Many lost phone service,
went without meals or skipped medications to save money. Although the
study relied largely on people's own accounts of their finances, the
figure suggests that as many as 400,000 American families file for
bankruptcy each year because of medical expenses.
"Not only are the bills higher, but the way we pay for care has
changed," said Elizabeth Warren, a professor at Harvard Law School and
one of the study's authors. "My mother always carried a bill with the
doctor, but every dollar she paid went to principal.
"Today, the doctor takes a credit card, and a family might be paying
that off at extraordinary interest rates. So people may recover
physically from major medical injury, but may not recover financially."
A Shift in Burden
Though health care costs have been rising for decades, changes in
insurance starting around 2001 have put more pressure on consumers,
especially those who need the most treatment, said Paul Ginsburg,
president of the Center for Studying Health System Change, a nonpartisan
research group financed primarily by the Robert Wood Johnson Foundation.
The families driven into bankruptcy by these costs include those dealing
with both rare and common medical conditions, and others who simply
saved too little or owed too much in the false confidence that there
would not be unforeseen medical problems, or that their insurance would
protect them.
In Pfafftown, N.C., Glenda and Robert Lee Gantt filed for bankruptcy
protection after Mrs. Gantt's rheumatoid arthritis
forced her to give up working as a security guard. In Houston, Roy and
Patsy McKanna filed for bankruptcy after helping their adult daughter
pay for breast cancer treatment.
"We were just trying to keep them from sinking until things got better,"
said Mrs. McKanna, 71. "They took bankruptcy a little more than a year
before we did. We managed our budget for 52 years. You never know what
life's going to throw at you."
In the 1990's, as medical expenses rose faster than inflation, insurance
companies limited costs of coverage by limiting patients' treatment
options through the system known as managed care. Even as hospitals and
drug companies introduced expensive new treatments, out-of-pocket costs
for patients actually fell during the decade.
But as consumers have objected to the limits imposed by managed care,
insisting on more choice, the trade-off has been higher insurance
premiums and higher out-of-pocket costs, said Arnold Milstein, medical
director of the Pacific Business Group on Health.
Dr. Milstein said companies had two rationales for shifting expenses to
consumers: to "share the pain" that came with higher overall costs and
to encourage patients to seek care judiciously.
"But what if you're unlucky enough to get sick?" he said. "Now you pay a
lot more out of pocket. One of the unintended consequences of
cost-shifting is that sicker people - the ones who most need insurance -
are the ones who end up paying more of their bills."
From 2000 to 2005, employees in the most common type of insurance plan,
known as preferred provider organizations, saw their premiums for
individual coverage rise 76 percent, to $603 from $342, while their
deductibles - the amount they pay out of pocket before insurance kicks
in - rose almost 85 percent, to $323 from $175, according to the Kaiser
Family Foundation. By 2003, a survey by the Center for Studying Health
System Change estimated, 20 million American families had trouble paying
their medical bills. Two-thirds of these had health insurance.
Twists of Fate
Mr. and Mrs. Dorsett never expected to be part of this group. They met
more than a decade ago at a gas station where she worked part time while
studying to be a nurse.
Mr. Dorsett liked to talk on his way home from work. Both wanted to have
a big family. They married with plans to have six children. Mrs. Dorsett
hoped to finish her studies and work as a nurse; Mr. Dorsett thought she
should stay at home with the children.
But shortly after Zachery was born, they knew something was not right.
He got the same illnesses or infections as other children, but while
others got better, he would get worse. A cold would turn into bronchitis
a sinus infection would require 45 days of antibiotics
and often turn into pneumonia. He needed follow-up doctor visits,
refills on prescriptions, X-rays, CAT scans - each time ringing up
co-payments of $10, $15, $30 or more.
On a blazing summer evening, the Dorsetts sat at their kitchen table.
Their one extravagance, a large-screen television, occupied the
children: Zachery, 8; Dakota, 5; and Jessica, 4. Mrs. Dorsett bought the
television with her mother as a present for her husband, from money she
had earned baby-sitting. Mr. Dorsett, she recalled, had complained about
the expense.
At 40, Mr. Dorsett has a ruddy complexion, buzzed blond hair and a light
beard. As he nursed a can of supermarket-brand cream soda, he seemed to
wish he could turn back the calendar, find some alternative to
bankruptcy court. It is a source of recurring friction between them: Mr.
Dorsett never wanted to file; Mrs. Dorsett convinced him that there was
no alternative.
"I make good money, and I work hard for it," Mr. Dorsett said. "When we
filed for bankruptcy, I felt I failed."
He said one of his hardest moments was telling his father about the
bankruptcy. His father had worked two or three jobs during hard times,
but always managed to pay his debts. Arnold Dorsett made more money than
his father ever had, he said, but what good did it do him?
"At work," he said, "the single guys say our insurance is good. Well,
it's good for them, because they don't have kids, or don't get sick.
When you have a kid who's chronically sick, it's totally different."
On his long days, Mr. Dorsett usually skips lunch rather than spend $6
or $7 at a fast food restaurant. He wishes he could take the family to
the Grand Canyon, or afford a house where the girls could have their own
bedrooms. But when asked about his sacrifices, he said the luxury he
missed most was time, not money. "Zach and I had no relationship until
two years ago," he said. "Dakota hardly ever talked to me. I was putting
in 80, 90 hours a week, not having a relationship with my children."
While Mr. Dorsett works, Mrs. Dorsett juggles child care with the
seemingly endless wrangling with insurance companies and, until the
bankruptcy filing, with creditors.
Managing a Medical Mystery
On an August morning at home, Mrs. Dorsett prepared a lunch of corn dogs
and macaroni and cheese while Zachery got ready for soccer camp. By all
appearances, he is a healthy-looking boy with a somber disposition.
Though he has missed as many as 42 days in a school year because of
illness, he has friends and keeps up with his classes, his mother said.
His worst problem at school, she said, is pushing himself too hard.
Until earlier this year, no one knew what was wrong with him. His immune
disorder, known as common variable immune deficiency, can be detected
through a simple blood test, but as Mrs. Dorsett took him from doctor to
doctor, usually with small problems that would not go away, the doctors
looked elsewhere. Some treated only the immediate symptoms; others made
Mrs. Dorsett feel she was overtreating her child.
"I felt there was something wrong," she said. "But you can't walk into a
doctor's office and say you think you know what it is because you saw it
online. They're the ones with the prescription pads, and I didn't want
to make them mad."
As the family went from one doctor to the next, without a diagnosis of
the root problem, the insurance company often questioned the expenses.
Why did Zachery need four doctor visits or five rounds of antibiotics
for an ailment that most children shook off in a couple of days? Mrs.
Dorsett spent days on the phone, often in voice-mail loops, and often
long-distance, pleading her case.
"Like when they refused to pay for antibiotics when he had pneumonia"
last year, she said. "The antibiotics cost $373, and we didn't have it.
But we couldn't just not give it to him. I knew the review board would
come around eventually, but he needed the medicine right away. Finally
the doctor gave us samples."
She managed the expenses, like many people, by constantly applying for
new credit cards, rolling the debt from the old cards into the new ones,
which usually came with low introductory interest rates. In a good year,
they would have the rolling charges on their credit cards down to $5,000
or $6,000, but the charges always went up again.
Gradually the debts started to catch up with her. When she fell behind
on one of her heavily used cards, the company raised the 2.9 percent
interest rate to 14 percent. Suddenly, she could not find a card with a
low interest rate or a line of credit of more than $5,000, when the
family balance exceeded $13,000. She tried playing dumb with the
company, saying she was sure she had sent the check. "But they weren't
buying it," she said.
With Mr. Dorsett's insurance, Zachery's bills were not astronomical, but
they were just beyond what the Dorsetts could afford. Finally, Mrs.
Dorsett asked one of the hospitals for assistance. "They said all I
could do was go to churches," she said. "Which is worse, filing for
bankruptcy or - I'm going to say it - begging at churches?"
Now, Uncertainty
Since the couple filed for bankruptcy protection in March, the creditors
have stopped calling for money. The Dorsetts filed for, and were
granted, protection under Chapter 7, which means that a trustee will
liquidate their nonexempt assets to pay their creditors. But as in most
Chapter 7 cases, there are no assets to liquidate.
In the meantime, since they are resigned to losing their house, they are
putting aside the money that would have gone to the mortgage for the
next round of big expenses. For the first time since Zachery's birth
they are saving money.
Even now, credit card companies still offer them cards, which they have
turned down. But because of the bankruptcy, they know they will not be
able to secure a mortgage on their next home. Many of their friends, and
especially the mothers in Mrs. Dorsett's preschool group, do not know
about the bankruptcy.
Even with their debts cleared for the moment, there are no guarantees
that the Dorsetts will be able to stay above water. The immune globulin
may keep Zachery out of the emergency room this winter, but it may not.
They have no credit to buffer unforeseen expenses - a sudden car repair,
a slowdown at work, braces.
Mrs. Dorsett tried to put the best spin on the contingencies that loom
over their lives: "If we get another house for under $800 a month, if
nothing else happens, if the treatments work, we'll make it."
And if things do not work out, they will face that another day, and for
many days after that.
