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Solution: End the Insurance Gap for People With Preexisting Conditions
In this Solution

Solution: End the Insurance Gap for People With Preexisting Conditions

In this Solution

In this Solution, Dina Rasor takes on a little-understood but truly draconian provision in the massive health care reform bill. The provision, requiring the most sick and most vulnerable to forgo any medical insurance coverage for six months in order to qualify for government coverage, could have devastating economic and social consequences if it is not addressed.

-Matt Renner, Truthout

For the 12.6 million Americans who have preexisting health care issues and have been turned down by insurance companies in the past three-plus years.

The good news: The health care reform law’s stopgap Preexisting Condition Insurance Plan (PCIP) program will get you to 2014, when discriminating by preexisting condition will be illegal.

The bad news: You have to put your health problems on hold for six months.

In 2014, it will be illegal to discriminate against any American who has a preexisting health condition when applying for health insurance. Since there are millions of Americans with preexisting conditions (over 57 million of us under the age of 65 – one in five of us), the health care law set up a high-risk pool in each state to allow those who have been turned down by insurance companies to buy insurance at a reasonable cost until the full enactment of the law in 2014. There were political fights about these pools – some people viewed them as a sneaky way to create a public option – and a recent Washington Post article suggests that there might not be enough money allocated to the programs. The states had a choice between creating the pools themselves or letting the government set them up, and the feds were pleased that they were able to set up all the pools within six months. But as of November 1, 2010, only a little more than 8,000 people have qualified for the pools.

One of the reasons that enrollment is so low could be that the law has a serious Achilles heel: You can’t be accepted into the PCIP high-risk pool until you’ve gone six months without any health care.

What is the world is that all about? There were fights over this provision, which was inserted into the bill because some in the Senate Finance Committee were afraid that people with preexisting conditions who already had health insurance would dump it for the high-risk pool’s potentially lower premiums. In the House version of the bill, people were concerned that employers or insurance companies would dump their employees or enrollees with preexisting conditions onto the government pool to lower their existing insurance costs. The House bill suggested that companies and insurance providers be fined for attempting that maneuver. The Senate, determined to prevent sick individuals from “gaming the system,” decided that these people would have to pay the physical and financial price of not having health care for six months.

Here is how FOX news reported the dilemma while the bill was being debated:

“If you are a cancer patient and have cancer now, you can’t wait six months to go into a plan because your condition can go from bad to death,” said Stephen Finan, a policy expert with the American Cancer Society Cancer Action Network. He called the waiting period in the Senate bill “unacceptable.”

…”If you are somebody with cancer or a heart condition who needs immediate coverage and immediate treatment, that’s not very helpful,” said Karen Pollitz, a Georgetown University health policy professor.

Senate Finance staffers say the restriction is meant to prevent people switching from more expensive coverage to take advantage of government assistance.

But the House health care bill unveiled last week by Speaker Nancy Pelosi, D-Calif., doesn’t include a waiting period. Instead, it would require insurance plans who “dump” seriously ill patients to repay the federal pool. “The House provision will provide immediate relief for people with high-risk conditions who have no alternative for coverage,” said Finan.

The Senate version won. Now we are stuck with an untenable situation for potentially millions of sick Americans: no health care for six months.

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For those who have a chronic or potentially fatal disease, who are just one job loss away from no health care, this is a scary situation. Having a preexisting condition can be viewed as a civil rights issue, because most of us who have one have no control over it, just as we don’t have control over whether we are black, white, Hispanic or Asian, or whether we are male or female.

During the health care debate, Jonathan Alter of Newsweek, a cancer survivor himself, put it this way:

The core principle behind health-care reform is – or should be – a combination of Social Security insurance and civil rights. Passage would end the shameful era in our nation’s history when we discriminated against people for no other reason than that they were sick. A decade from now, we will look back in wonder that we once lived in a country where half of all personal bankruptcies were caused by illness, where Americans lacked the basic security of knowing that if they lost their jobs they wouldn’t have to sell the house to pay for the medical treatments to keep them alive. We’ll look back in wonder – that is, if we pass the bill.

Because of the provision requiring six months without health insurance, this discrimination against people with illness will continue another three years.

Beyond the personal dilemmas faced by people with preexisting conditions, this provision will produce serious unintended consequences that will weigh on our economy and American society as a whole. If these individuals cannot get insurance for six months, they can try to pay for the treatment themselves, avoid any treatment and risk deeper illness or even death, bankrupt themselves and their loved ones in order to afford the expensive health care that can keep them alive and functioning, use their mortgage money to pay for treatment and lose their homes or, if all else fails, go to the emergency room and put the high cost of their fight for life and health onto the people who do have health insurance – and we’ll all pay higher premiums.

During those six months, these individuals could become too sick to work. They may never return to work or pay taxes again, leaving them on the unemployment and disability rolls, or they may go bankrupt or have foreclosed homes: three problems that we know are already bedeviling our economy. These are very real possibilities, because an astounding 62 percent of bankruptcies and 23 percent of foreclosures in this country are due to medical bills.

The six-months-without-insurance requirement was passed in such a way that the executive branch can’t regulate it away. The Obama administration has adjusted the preexisting pools to give them more options and lower premiums, but the six-months rule must be changed legislatively.

In this new hyper-charged political atmosphere, in which many new Congress members will be trying to eliminate the health care law altogether, it may seem a tough undertaking to introduce legislation to eliminate this last vestige of discrimination against people who get sick. However, I think that there may be a way to convince a majority in each chamber that this is not only the compassionate thing to do, but also the fiscally responsible thing to do.

My solution to this problem would be for one or several members of Congress to ask the nonpartisan Congressional Budget Office (CBO) to use its best economic modeling to project the cost to the federal and state governments and to the economy if, during the six-month waiting period, a reasonable portion of at-risk Americans stop working and paying taxes due to increasing and untreated illness, go on unemployment insurance or disability, go bankrupt, lose their homes or visit the emergency room, with those costs draining the rest of the health care system. The model should project those costs over the three-year period until 2014 when the discrimination ends, and should also consider that many baby boomers are reaching the age when a majority of them will have a preexisting condition, which may be as simple as high blood pressure or as deadly as treatable cancer that is allowed to progress to stage four.

In a Congress that promises to be consumed with cost scrutiny rather than compassion, I believe that this study would show that the cost to the government and the economy far outweighs the cost of lifting the rule. Armed with facts of the expensive consequences of this provision, a new bill could be introduced that would lift the perilous and expensive six-month waiting period. The bill could incorporate safeguards from the original House bill to prevent employers or insurance plans from dumping individuals onto the government, by making the fine for such action higher than the cost of keeping individuals with preexisting conditions on the health plan.

While the cost of the 12 million people who have been rejected from health plans could make a severe impact on our wobbly economy, there is a larger group of people with preexisting conditions who are just one job loss away from making the costs of this six-month wait even more ominous. Consider this study from Families USA, as reported in Politico:

Approximately 57.2 million people under the age of 65 – more than one in five (22.4 percent) of America’s non-elderly population – have a diagnosed preexisting condition that could lead to a denial of coverage in the individual health insurance market, according to a report released today by the consumer health organization Families USA.

Whether you point to the civil rights and humanitarian consequences of waiting six months for insurance or illustrate the fiscal costs to our government and our society, this rule needs to be eliminated legislatively for the next three years until we, as a nation, finally put an end to this discrimination against those who suffer. There is no hold button on disease.

Will there be courageous members of Congress who will step up to the task?