A friend of mine had to take an extended leave from his job because of medical problems. He realized that for the next few months, maybe longer, it would be difficult. He did have good health insurance from his employer, as well as a short term and long term disability policy. After using up his sick pay and vacation time, the short-term disability would pay him sixty percent of his pay for the first six months. His health insurance would remain in effect as long as he paid the extra premium that would have come from his paycheck each month. Unfortunately, his condition did not improve after six months and he was forced to go on the long-term disability. He could continue his insurance under the provisions of the COBRA law, but his health insurance rates rocketed skyward, almost to the point that he couldn’t afford the $600 monthly premium. I recently heard about a family whose medical bills exceeded the $1 million limit on their policy. Their newborn son developed some serious medical problems and now the family that thought they were covered has paid and still owes a total of over $100,000.
A report made public on Thursday by three advocacy groups in the St. Louis area, gaps in coverage and cost-shifting to patients are forcing even families with insurance to struggle with mounting medical costs. According to the Access Project, St. Louis Area Jobs With Justice, and the Missouri Citizen Education Fund, having health insurance doesn’t protect you from medical debt and the possibility of financial hardship.
A study in 2005 by the Commonwealth Fund found that about one-third of Americans with health insurance had incurred medical debt and were having problems paying for the costs in the past year. The report was titled ” The Illusion of Coverage: How Health Insurance Fails People When They Are Sick.” The report found that many people did not have comprehensive coverage, didn’t understand their benefits, or didn’t realize that some policies limit lifetime benefits.
The authors of the report want legislators to require insurance companies to provide standard disclosure forms and examine premium rate increases more closely. They also recommend setting up public-private partnerships to provide more comprehensive coverage to lower income families.
There seems to be two schools of thought about shifting more of the health care costs to the consumer. Some consumer advocates maintain that shifting a large amount of the health care cost to the consumer defeats the purpose of the insurance in the first place. The insurance companies, quite expectedly, disagree. They maintain that when patient’s share of the cost goes down, the demand for services goes up.
Despite their increasing popularity, high-deductible insurance policies offered by employers still make up only a small percentage of the total market. Employers are also shying away from increasing a worker’s share of their health care costs according to a survey by Mercer Health and Benefits in New York.
Any way you look at it, the best thing to do is to examine your policy closely.