In the July issue of CJR and on CJR.org, we introduced readers to a woman we called Carol, who had contacted me about her health insurance options. Carol lives in a Philadelphia suburb, works as a freelance proofreader, and has an individual market policy from Aetna—which had just sent a letter advising that her monthly premium would increase $100 and suggesting she hang on to her policy, because the new ones she could buy on the insurance exchange would contain benefits she might not need. (Aetna’s letter didn’t mention she might qualify for subsidies.)
Carol decided to check out her options. Since the Pennsylvania exchange is run by the federal government, that has meant shopping on HealthCare.gov. I’ve spoken to her frequently over the past week, and her experience shows just how hard it is to be a good consumer of health insurance—despite the pledges of the Obama administration, which promised that buying a policy would be as simple as buying an airline ticket. The frustration starts with the troubled government website, of course, but Carol’s story is also about a lack of help and good information from Independence Blue Cross, the carrier whose policies she thought she wanted. It is also a tale that shows how important shopping tools—good, accurate, and complete information, along with consumer protections—often remain either hidden or nonexistent. It’s caveat emptor in the insurance jungle!
It’s fair to ask whether informed consumer choice is even truly possible, given how complex policies are and the myriad features that must be examined to make a good comparison. To have a chance, shoppers will need a press that’s on their side—consumer-focused coverage that delves into the details and explains risks and trade-offs. (As we’ll see later, there’s been a bit—but only a bit—of that in the leading media outlet in Carol’s region.) We hope our look at Carol’s story serves as a model for reporters doing similar stories around the country.
Carol’s search for a new policy began on Nov. 5. She hoped that the continued fixes the government claimed it was making to HealthCare.gov had made it possible to shop, but she knew going in it would be a challenge. “I’m totally mixed up,” she told me. “Like everybody else in the U.S., it’s not like insurance is the number one thing I think about when I get up.” One thing she did think she knew: she didn’t want another policy from Aetna, where she’d been disappointed with customer service. “I can’t get any issues resolved without several phone calls,” she explained.
On her first try with the website, she found a page that listed 27 plans for her county: 15 sold by Blue Cross, 12 by Aetna. While that might appear to be a fair amount of choice, there were only two carriers, one of which she had ruled out. She was pretty much at the mercy of one carrier that dominates her state, a predicament faced by other consumers across the country. Also, the website provided only estimated premiums for the policies—some of which sported fanciful names like Aetna Advantage Plus, Keystone HMO Silver Proactive, or even Personal Choice PPO Bronze Reserve, which sounded more like a wine label than the name of an insurance policy. The webpage advised that Carol would get final quotes for specific plans after she had completed a Marketplace application.
She tried to do that, but couldn’t get beyond the security questions. The site told her she couldn’t use the same answer to more than one question, but when she complied, she was still stuck. She tried again the following day. Same problem that day, too—and the next, and the next, and the next. (All told, she made 24 visits over eight days.) Frustrated, she called the 800 number listed on the site and talked to a person who gave the administration’s standard line about computer glitches, and then offered to create an account with her on the phone. She also suggested Carol call the insurance companies directly and ask for details, or complete a paper application and mail it in.
But Carol didn’t have enough details about the policies to sign up over the phone or on paper. She decided to investigate further, using the website of Independence Blue Cross. I had suggested that she ask about a document called the Summary of Benefits & Coverage, a good consumer disclosure statement; insurers are not required to provide these summary forms, but consumers have the right to receive one if they ask. But what Carol got from Blue Cross was not the official coverage document—it offered some details, but not enough to make a fully informed decision.
Furthermore, the premiums listed on the Blue Cross documents did not match the estimated ones she had seen on HealthCare.gov. Premiums on the website appeared to be as much as $200 lower, and the website had said they might be lower still if she qualified for a subsidy (she’s probably right on the cusp of eligibility). When she asked about the discrepancy, a Blue Cross representative told her the premiums on the government website were wrong. As she recounted the conversation to me, the rep told Carol he could send information for only three plans, but in her case he would make an exception and send eight—including two “platinum” plans and something called the Keystone HMO Silver Proactive. That one mystified her.
The Keystone Proactive model offered a fairly cheap monthly premium of $543, but the amount of coinsurance, deductibles, and copays for hospitals and primary care doctors varied according to “tiers.” For example, if Carol chose a Tier 1 hospital she’d pay $400 per day up to $2,000. If she chose a Tier 2 facility, her out-of-pocket amount would be subject to a deductible and she’d pay $800 a day up to $4,000. And if she chose a Tier 3 hospital she’d have to pay $1,250 each day after satisfying her deductibles. What did these tiers mean, she asked the insurance rep, who told her the tiers identify “cost effectiveness among providers.” What did that mean, she asked again, and the representative advised her not to buy that policy. Why? Because it was too hard to work with the tiers.
Carol asked me what the tiers meant, and I looked further on the insurer’s website. Blue Cross assured customers “all of the doctors and hospitals in our network must meet high quality standards,” but “some are able to offer the same services at lower cost”—and if a patient chooses a provider in Tier 1, they pay the lowest out-of-pocket costs. “You get control over how you spend your health care dollars,” the website advised. More control, maybe, but also another layer of complexity to an already super-complex task. And I had questions about how doctors and hospitals are chosen to be in each tier. Do they look at patient safety records when deciding which hospital goes in which tier? How do we know placement is not based on a financial deal between the insurer and the hospital? What went into the designation of a “Blue Distinction Center” for hospitals? I wanted to know more than that the hospital “meets rigorous quality standards” and “consistently demonstrates positive care results.” Earlier this week I called the communications office at Independence Blue Cross to ask my questions. To date, no one has returned my call.
So how about plans without all those tiers? Carol ruled out HMOs, with their restrictive provider networks, as well as “bronze” plans, which would cover only 60 percent of her medical bills. She looked at something called the Personal Choice PPO Silver, with a premium of $695, but had a hard time figuring out what her total costs would be.
The sheet sent by the Blue Cross rep listed copays of $30 for primary care doctors, $70 for specialists, and $10 for generic drugs. But only some of the details about the plan’s high coinsurance rates were listed on the sheet. Further website research showed she’d have to pay 30 percent after the deductible for outpatient surgery and routine radiology services, for example, if she stayed in the network. The coinsurance would be 50 percent if she went out of network. (As we’ve pointed out, high coinsurance amounts are becoming the norm, and consumers continue to confuse smaller copays with the larger coinsurance costs.)
Carol understood the deductible, though. It was $2,000 in network and, according to the website, a whopping $10,000 if she went out of network. (The reform law’s limits on out-of-pocket spending generally don’t apply to out-of-network expenses.) “That’s crazy,” she said. “By the time I pay that, the year will be up.” She had just met the reality of today’s health insurance market—many policies these days are akin to catastrophic insurance, meaning policyholders pay most of their bills out-of-pocket before insurance kicks in. “I was so turned off by the deductible, I exited out,” she told me.
The process had been exhausting, time-consuming, and confusing—and she wasn’t close to done yet. But at least Carol was making some progress in figuring out which plans didn’t work for her, and avoiding pitfalls by paying close attention to the fine print.
Consumer-oriented coverage can help people through that process. And since the rollout of the insurance exchanges, a couple of the leading local news outlets in Carol’s area—the Philadelphia Inquirer (going through a tumultuous period) and Philly.com—have offered some of that sort of coverage. On Oct. 21, Inquirer reporter Harold Brubaker delivered a strong story about a local man, Lee Koff, who’d been dumbfounded to receive a bill for more than $6,000 after a new defibrillator implant; in 2010, a similar procedure had left him with out-of-pocket costs of $81. The difference? A coinsurance provision applied when Koff’s plan was his changed by his insurer.
Koff is an 87-year-old with Medicare Advantage plan, so he’s not shopping on the new insurance exchanges. But his experience, as described by Brubaker, is relevant to consumers throughout the insurance marketplace (that’s an important point for reporters: the lessons about digging into the fine print are often the same, no matter what sort of plan you’re shopping for). From the article:
“The thing I looked for when I got the notification is, how much more is the premium. It went from $146 a month to $175.80,” Koff said.
Coinsurance is the piece that caused Koff’s $6,100 bill, but that change escaped him. “I think I’m pretty alert, but I didn’t read every word” of the plan description, he said.
Just this week, Philly.com republished a good piece by ProPublica’s Charles Ornstein about the coming “second rate shock”: many consumers’ discovery that what look like affordable premiums on the new exchanges will come with higher deductibles, copays, and coinsurance than they’re accustomed to. Larry Levitt of the Kaiser Family Foundation said this to Ornstein:
“I think it remains to be seen whether people see these plans as offering them good protection against catastrophic health expenses — which they do — or are disappointed that they won’t generally provide much coverage for occasional visits to the doctor or prescriptions.”
Philly.com also has a group health policy blog in partnership with Kaiser and an FAQ page where readers can ask questions of a local professor, both of which are worthwhile even if I found them a bit underwhelming. And last Sunday, the Inquirer profiled a local woman with serious medical needs who’s been working with a “certified marketplace enrollment specialist,” though the article was a little light on detail to serve as resources to other readers.
But a few good articles aren’t enough. There are lots of pieces to this story at the moment, especially with the president now scrambling to try to deal with anger over policy cancellations in introducing some new complications in the process. But there are millions of people shopping for policies in a confusing marketplace right now, and they need all the help they can get. National news outlets and niche blogs have a role to play, but major local news organizations have an important responsibility: with plan offerings and regulations differing state by state (or even county by county), they’re the outlets that can drill down and provide targeted guidance to local consumers.
By Tuesday Carol had had enough of this website shopping business. HealthCare.gov allowed her past the security questions, but it kept telling her the user name did not work. “I feel like I’m getting nowhere,” she told me. “I can’t get on the goddamn website no matter what I do. It’s ridiculous.”
On Thursday, she thought she had finally hit the jackpot. The website allowed her to create an account—and then it froze once more, and she could go no further. (She was able to reach the website’s livechat service, and was told there are still glitches and to try later. “I feel at least there has been some improvement though,” she said.)
Carol is now thinking of keeping her Aetna policy after all; it’s grandfathered, so she can keep it as long as she pays the higher premiums. The question still is, what’s the best option for her? Oh yes—whatever plan she chooses, Pennsylvania law says she has 10 days to change her mind and cancel the policy. None of the materials and no website information she examined told her that.
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