When it comes to medical insurance, there are no guarantees

Staying Ahead

September 03, 2000|By JANE BRYANT QUINN | JANE BRYANT QUINN,WASHINGTON POST WRITERS GROUP

Most Americans believe that they'll always have access to medical care. The word "uninsured" conjures up the image of people not quite like us.

But in fact, we all live in a state of permanent medical instability. Almost anyone's personal coverage could be changed or snatched away at any time. Consider these four ways we could slip through the cracks:

Your insurer might fail or stop writing policies in your state.

We're seeing more of this turmoil, which has orphaned tens of thousands of policyholders. Since the start of 1999, 29 health insurers have collapsed, 11 dissolved voluntarily and 30 merged into another company, according to Weiss Ratings in Palm Beach Gardens, Fla. Unknown numbers of insurers have quit doing business in particular states.

Most people find new medical coverage, after the worry and stress we've somehow accepted as the price of access to care.

But what of the others? After every cancellation, some portion of the abandonees have to pay more for insurance, can't get any coverage for pre-existing medical conditions or fall into the slough of the uninsured.

If you're insured through your job, as is 65 percent of the non-Medicare population, your employer will almost always find replacement coverage.

Still, there's stress. You might have to change doctors. Sometimes the benefits aren't as good. Often, your share of the cost will rise.

In North Carolina, eight HMOs dropped out of the state-employee plan this year. Workers may have to pay 30 percent or 40 percent more to cover their spouses and children. But at least they'll be offered new insurance, even if they're ill.

You may not be so lucky, if your insurer fails and you're among the 4 percent (around 9.5 million people) who have individual coverage.

Individual coverage is insurance you buy yourself. If you're in good health, you can usually replace it. But if you or a family member has a current or prior illness, you may not find a policy you can afford.

Sometimes, states help you find replacement policies after an insurer fails. In February, Florida ordered all insurers in the state to accept refugees from the defunct SunStar Health Plan.

But the sign-up period had to be extended when it turned out that some of the insurers were fending off policyholders' calls.

States generally have high-risk pools or similar arrangements, if you have a health problem and can't find private coverage.

But the pools may be unaffordable, too. Take the risk pool in Texas, which has enrolled 284 people marooned by the failure of the Harris Methodist Health Plan. Risk-pool premiums start at 50 percent above the normal market price.

You might lose coverage if you leave a group-health plan.

Workers often assume they're OK because, by law, insurers must offer you individual coverage, after your benefits run out.

Bad assumption. The law won't do you any good, if you or one of your kids has had a noticeable illness. The insurer can avoid taking you, by quoting a prohibitive price.

Your Medicare HMO might walk away.

Medicare HMOs are squabbling with Congress over how much they should be paid. In the past, they've received enough to offer you extra benefits, including prescription drugs. That helped them attract 16 percent of the Medicare population.

But the 1997 Balanced Budget Act reduced the generous reimbursement to Medicare HMOs. Now, insurers are dropping plans that don't provide the profits they want.

About 934,000 people - most elderly, some disabled - will be abandoned by their HMOs this year. That's on top of 327,000 people cut in 1999 and 407,000 in 1998. In Maryland, only one, Kaiser Permanente, will remain after Dec. 31.

Seniors who can't find, or don't want, another HMO will automatically be re-enrolled in traditional Medicare. So you don't risk being kicked out of the system, as some younger people are. But you face the worry of finding new doctors and, perhaps, losing access to low-cost prescription drugs. Medical care costs more out of pocket, outside a Medicare HMO.

The move from welfare to work is taking a toll.

A 15-state study by Families USA, a consumer group, found that 945,000 low-income parents had lost Medicaid coverage. Typically, their new jobs offered no health-care benefits, or offered a plan they couldn't afford.

America has many of the world's best doctors and hospitals. But our access to them isn't as sure as some of us think.

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