Even the insured have trouble paying bills

From John Curry, March 22, 2007

Subject: An article that the hc insurers didn't like to read.....

USA Today, March 21, 2007

Report: Even the insured have trouble paying bills

INSURANCE PROBLEMS

Interviews with 45 people with insurance who faced financial problems found:

• About two-thirds cited premiums, deductibles and co-payments as one source of their medical debt.

• One-third had debt because their insurance did not cover such things as drugs, dental care or medical equipment.

Source: The Access Project

By Julie Appleby, USA TODAY

When Janet Fredrick got breast cancer in 1998, she never thought she would face bankruptcy because of medical bills: She had insurance. But her illness dragged out, then her income plunged when she went on disability. By 2005, her co-payments for treatment, including surgery, medications, doctor visits and hospital care, totaled about $8,000.

Such co-payments and deductibles, along with difficult-to-understand policies and complex hospital billing issues, are among the main reasons even people such as Fredrick who have health insurance can face devastating financial costs, says a report out today from The Access Project, an advocacy group that researches medical debt.

"They were going to cut off services because I could not pay," says Fredrick, of Urbana, Ill.

After the hospital and clinics refused to accept $25-a-month payments toward her bills, Fredrick filed for bankruptcy and is now paying off a portion of those bills and credit card debt at $300 a month.

FIND MORE STORIES IN: Health Insurance Plans The Boston-based Access Project studied Fredrick and 44 others who had trouble paying medical bills to determine why they ran into difficulties. The study was funded by the W.K. Kellogg Foundation and the Missouri Foundation for Health.

The study comes as higher annual deductible policies — those at $1,000 or more for individuals or $2,000 for families — are being touted by some policymakers, insurers and employers as one way to control rising health care spending in the USA.

Most insured people have lower annual deductibles, according to data from the Kaiser Family Foundation. Even with lower deductibles, some families are having trouble.

In October, a poll by USA TODAY, the Kaiser Family Foundation and ABC News found that one in four Americans had trouble paying for medical care during the year. Among those reporting trouble paying, 69% had insurance.

"Shifting more costs onto patients has significant health access and financial consequences," says Carol Pryor, senior policy analyst for The Access Project.

Mohit Ghose, spokesman for the industry trade group, America's Health Insurance Plans, says the study unfairly blames insurers for rising costs.

He says there are many reasons spending on health is going up, including new treatments and drugs, rising demand as the population ages and "defensive medicine" by providers worried that they will be sued if they don't run every test or offer every alternative to patients.

"For too long, people have found it convenient to put any and all problems with the health sector at the doorstep of health insurance plans," says Ghose.

Along with deductibles and co-payments, The Access Project found other factors associated with medical debt were annual or lifetime "caps" on benefits; extra charges for "out of network" care, even when admitted to in-network hospitals; and complex billing systems by insurers and hospitals that left patients confused about what they owed.