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Wednesday, October 03, 2007

CA Health Insurance Rant…

With the exception of government and some other highly unionized professions (education, auto makers, etc), the employer paid health insurance ends when you leave your employer (or your employer leaves you!).

The few times I found myself between jobs in my previous career, we had no problems signing up for a policy from one of the “Big Blue” named insurance carriers to protect us from a potential catastrophic health event.

That was before we got “old”.

After the last layoff, I found that being over the age of 55 was a definite problem for the “Big Blue” Insurance Co. who happily took our check just a few years earlier. After some negotiation and intervention by our insurance agent, they reluctantly accepted us back as an insured couple. We were, once again, covered for any catastrophic event over the first $5000.00 deductible.

Then the rates started going up like clockwork every six months. We countered by adjusting our definition of “catastrophic event” to mean anything over $7500.00 in the futile effort to just “maintain” the cost of insurance. For this coverage we paid “Big Blue” approx $6000.00/yr

If you do the math, you would see that we were spending $13k before we get any help to cover a major health problem.

One of the reasons I started substitute teaching was to cover insurance costs for just such an event. There are 180 teaching days in a year for a max potential income of about $18k (after taxes) per year.

Since subs on call rarely work all possible schools days, my experience these last four years has been that subbing will bring in approx $7k-$10k per year.

When the “Big Blue” insurance co. notified us late last year of yet another increase to $760/month, we started hunting for a more affordable alternative.

We found an insurance company located in the Mid-West, hence forth to be referred to as Crap Ass National, Inc.

The agent for CA described her company’s coverage as a $5000 deductible (per scheduled incident) policy for the same price as our “Big Blue” policy before the latest rate increase.

With over 30 years experience dealing with employer PPO plans and additional downtime years with “Big Blue”, I thought I knew how the system was supposed to and did work. In the four years since the layoff, we had no health issues that even came close to the deductible limits. Other than semi-yearly rate increases, there were no surprises.

The CA National plan sounded good to us, so we signed on the dotted line and felt we had an “ok” deal.

That was until we had our first major event covered under CA National.

I got a call, one day, last June that Claudette had fainted in the beauty salon and that the paramedics and ambulance had been called. By the time I got there, she had regained consciousness and was strapped to a gurney to be transported to the hospital for further tests.

The resulting diagnosis and cause was: vasovagal syncope. In layman’s terms: “fainted – no apparent reason”. Evidentially I also have vasovagal syncope because I sometimes faint when I get shots.

Three months later we get the bills.

Ambulance: $1,896.00

Hospital ER: $13,450.00

Ok, Ok, that’s a lot of money but we’re covered, right? This should cost me only my five grand deductible and the rest is up to CA National – Right??.

Not exactly!

It seems that the ambulance isn’t a network provider, therefore not covered. CA National doesn’t pay for anything not on their “schedule of allowed medical treatments” and only up to a company specified limit of the procedures that ARE allowed.

After the insurance PPO discounts, disallowed coverage and limits of the allowed stuff, CA National cut a check for exactly $1000.

CA National then sent us a notice of an insurance rate increase of $800/year and leaving me holding the remaining bills for $8800.00

I called CA National to ask what happened to my “five thousand deductible” limitation.

It seems that I hadn’t been diligent in reading and understanding all the fine print that the agent, selling me the policy, glossed over.

(I know this post is long and boring to most people, but it lets me blow off a little steam…)

But there IS some good news. After contacting the ambulance company and the hospital on my own, I was able to negotiate a 25% discount off both bills, just for asking!

I also discovered that the hospital offers an “uninsured patient” discount which happens to be just about the same amount that ALL the insurance companies get as a PPO discount. This means that had I not had insurance, I would be paying about the same amount as I am paying with CA National except that I wouldn’t have wasted thousands of dollars paying premiums.

Needless to say, we aren’t going to remain a client with CA National.

If “National Health Care” is going to be the driving issue in the next presidential election, I have a few ideas to propose.

It’s clear to me that what this country needs is LESS insurance industry involvement in our health care and more individual control on what we spend and how spend it.

I propose the following:

1. Allow anyone to establish a tax deductible Health Savings Account (HSA) without the requirement that it be tied to a health insurance company policy. Require that the money from the account can only be spent on health care or additional private health insurance only.

2. Have our benevolent government cover the costs of any catastrophic medical conditions in excess of some large deductible, like say $20k/year.

This should allow “we the people” the choice on how to save or spend our own resources for actual medical, dental and/or additional insurance to offset the huge government deductible.

I’d vote for a guy or harpy running for office with something like this idea in mind!!!


Anonymous said...

That is a great suggestion. The only problem is you have certain folks who will then argue that certain income levels should not have to pay the same "$20,000" that others pay who can obviously afford it. The income rationale will come into play. Plus what if someone did go broke and cannot pay? What do we do then? Put them in jail for failure to pay. Lock them up? This is a cool suggestion but you need to play devils advocate and come up with solutions to the arguments which are sure to come.

Anonymous said...

I wanted to leave one more comment about the original article.
I like the idea of having larger deductibles, even if they are only $2500 or so and do away with CoPays. I see people with small copays running to the doctor for every cough, cold, and sneeze. That abuses the system. Sure, they have a great plan with the large corporation. But I assure you someone down the road is paying a larger premium for that person who uses their health insurance plan for the minor things in life.

KauaiMark said...

"...what if someone did go broke and cannot pay?"

We have those folks now that are walk'ins to the county and public facilities and are treated as charity cases. I don't see that as changing.

I picked the $20k number out of the air. Have different levels for different verifiable income levels.

$0, $5k, $10k, $20k, $50k, $100k, $500k...

Similar as tax rates for income levels...

I'm just trying to get the insurance co's hands off my balls!

Darren said...

When I was growing up, our health insurance covered emergency room visits only. If we needed to go to the doctor, the parents paid for it themselves.

Considering how much is deducted from my paycheck each month for health insurance, I wouldn't mind such a scheme. Even paying for a random doctor's office visit or two, I'd still be money ahead.