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Two intimate views on health care cancellations

Published: Saturday, Nov. 9, 2013 11:24 p.m. CST
Caption
(AP photo)
This undated family photo provided by Shonn Hild shows landscape company owner Hild of Sullivan, Ill., in a family snapshot with his wife, Christy, and two children, 2-year-old Beckett and 7-month-old Harper.

CHICAGO – For Shonn Hild, a landscaper from Sullivan, Ill., the controversy over Americans losing their health insurance plans, despite a promise by President Barack Obama, is frustrating and personal. For Jon Gabel, a University of Chicago health care researcher, the surprise is not the mass cancellations, but any nostalgia for the individual insurance market before the president’s overhaul.

The policy cancellations are the latest issue dogging the president’s signature domestic policy achievement, leading to anger and finger-pointing. Millions of Americans who buy their own health insurance are seeing their plans canceled because they don’t meet the requirements of the nation’s new health law, despite Obama’s repeated promise that Americans who liked their health plans could keep them.

For perspective, The Associated Press interviewed two people with intimate knowledge of the issue, for far different reasons.

Hild was startled to learn the policy covering him and his two daughters had been canceled because it didn’t include maternity coverage. He found a new plan, but it has added to his household expenses and his frustration with politicians.

Gabel says the research he published last year predicted what was coming. His study found about half of Americans who bought individual insurance policies in 2010 had plans falling short of the new law’s requirements – plans that didn’t provide much financial protection for patients.

Here are edited excerpts of the two interviews:

FATHER OF TWO

Hild recently received notice from Blue Cross Blue Shield that the insurance policy covering him and his two children would be canceled after year’s end. His wife gets her health coverage through her job.

Q: When did you find out your policy is being canceled?

A: A couple of weeks ago, I was first informed our policy was going to be discontinued. ... I got an email, a phone call and a letter. I guess they wanted to make sure that I knew.

Q: Were you surprised?

A: I was very disappointed it happened, but I already had heard rumblings about it.

Q: What did you do next?

A: I shopped around and found another similar Blue Cross Blue Shield plan, but it’s about $200 a month more and has a higher deductible.

It just seems ignorant. I don’t understand why myself and two healthy young children — ages 2 years and 7 months — have to pay (more) when we won’t be using the maternity coverage. ... It’s even more expensive for us to get coverage under (his wife’s) work-based plan.

Q: What do you think of the Affordable Care Act?

A: I don’t care who you are and what you believe — it’s not more affordable. Our income is too high for us to qualify for a (federal) tax credit.

Q: How do you describe yourself politically?

A: I’m not an Obama supporter. I guess I’m an independent. I don’t side with the Republicans anymore. Everything’s a mess.

THE RESEARCHER

Jon Gabel is a senior fellow in the Health Care Research Department at the independent research organization NORC at the University of Chicago.

Q: Why are so many Americans receiving cancellation notices?

A: They are losing their policy because their insurer decided not to grandfather their existing plan. If the plan was grandfathered – if it remained largely the same as before the health law passed (in 2010) – it didn’t have to meet requirements such as providing essential health benefits like maternity care.

Why did insurers choose to grandfather some plans but not others? What I would speculate is obvious: The non-grandfathered plans were not viewed as profitable.

Q: What did your research show about the health plans available on the individual market in 2010?

A: We found that the majority – about 51 percent – of Americans were enrolled in plans that did not meet (the new law’s requirements). In other words, they were covered by plans that paid less than 60 percent of the medical expenses for a standard population. We called them “tin plans.”

Q: Tin plans?

A: I think of tin as being flimsy. These plans don’t offer much financial protection.

Q: But weren’t people happy with these plans?

A: People will like their plan until that moment they become sick and they discover it doesn’t cover certain benefits, or what it pays is grossly limited, or it doesn’t cover the doctor they want to see.

Q: What did your research show about the difference between insurance provided by employers and insurance bought by individuals in 2010?

A: Most employer-based health insurance was covering 80 to 89 percent of medical expenses for a standard population. ... That means you were far less likely to go bankrupt with employer-sponsored health insurance.

Q: What’s your reaction to so many Americans receiving cancellation notices?

A: We have such a byzantine system for health insurance. The (president’s) Affordable Care Act tried to make it kinder and gentler, but it is incredibly complex.

I am surprised people are romanticizing the individual insurance market as it was. ... If you really needed health coverage, if you really were sick, you couldn’t get it.

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