When I got the envelope in the mail from my private health insurance company, I didn’t think much of it. They send me various stuffed envelopes all the time, usually containing something I just need to file or toss out.
This one, however, was different, beginning with the ominous statement, “your policy will end on December 31, 2013.”
Whoa.
So, I became one of those folks in the group represented by outraged reporters talking about how Obama said, “you can keep your policy if you like it.” and then went back on his exact words. I “liked” my policy, in that it was relatively cheap and gave me catastrophic coverage in the event that I have something happen that could otherwise bankrupt me. I’d be out my huge deductible ($6K) and then not a penny more.
But that sounds like it might never have actually happened: people with plans like mine have had a long history of getting dropped by their company the second it appeared your account might start requiring lots of payouts. Generally the (legal) reason cited is that you withheld information on your original insurance application. Say, your claim involves checking out and biopsy of moles on your skin – the company could say that you didn’t note that you have lots of moles. Or, you are getting treatment for back pain issues but never mentioned in your application that you’ve ever felt a bit of back pain in your life. That’s an undeclared pre-existing condition, and therefore eligible for policy exclusion.
And it gets worse – the internetz are full of these kinds of reports from consumers:
- Getting cancelled by Wellpoint for breast cancer
- A 32-year old has to have a social media “bake sale” after being denied cancer treatments by Aetna (which started a mini Twitter explosion leading to Aetna picking up his policy again….)
- Justice.org’s (a trial lawyer resource site) PDF about how insurance companies attempt to deny claims
- A 22-year-old gets a nasty disease and is dropped by her policy, spurring fundraising locally.
- College student gets dropped days after turning 19 because company says it can’t prove she’s a student.
- And, in case you missed some, a Compilation of online news headlines on Reddit about insurance corruption
There was no law against this. So if that catastrophe happened, the insurance company could have (and might very likely have) paid out some hospital days or one inital ambulance ride, then called the whole rest of it a separate case (due to that pesky pre-existing or bad application stuff above) and dropped me like a hot potato. No recourse, only bankruptcy. Or a legal battle that you as the patient MIGHT win, but might not.
Then, there is my friend on the East Coast, paying for private insurance that costs far too much and hoping against hope that this whole Obamacare thing that is coming might actually benefit her and her partner. But she is very wary:
I’m afraid to be excited about this
A summary of our befores and afters:
- ME, Before: $120 per month with almost certain droppage after a major event. ME, After: $190 per month with far better basic coverage and no chance to be dropped.
- Her, before: $729 per month for “insurance” that did almost nothing she needed. Prescriptions were mostly out of pocket because the deductible was too high. Her, after: $341/mo with much lower deductible on prescription coverage. Her out of pocket per year goes from ~$8700 to ~$4100, and that’s just premiums. Nice deal.
And that’s how it works. It has to work that way. I am one of those gravy insureds: I am healthy. I’ll withdraw a few hundred bucks per year or less of my annual premiums in benefits. I am the person who helps to subsidize my friend on the East Coast. I am critical in the system as is everyone like me.
A special thank you to Julie today!