Obamacare’s biggest losers

December 11, 2013

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Photographer: Andrew Harrer/Bloomberg

After three months and more than 50 phone calls, John Gisler gave up on buying coverage through HealthCare.gov.

Gisler wanted to purchase a plan for his 45-year-old son, who has a rare degenerative condition affecting his coordination and speech. His current coverage through Utah’s high-risk insurance pool plan ends Dec. 31. By that time, the Obama administration expects enrollees to transition into health plans sold through the new health-care law.

But so far, Gisler hasn’t succeeded in purchasing coverage -- but not for a lack of effort.

“We’ve had three separate applications that failed to make it through,” Gisler says. “I have a notebook with all the calls I’ve made, maybe 50 or 100. It just goes on and on.”

Earlier this week, Gisler quit trying. Worried about a potential gap in coverage, he decided to forgo his son’s $3,000 tax credit and buy outside of the exchange from a local insurance broker.

“We have a son who is critically ill,” he says. “We cannot take any chances. Not having insurance would, in no short order, lead our family to bankruptcy.”

The Affordable Care Act is designed to expand health insurance coverage. But the law's insurance cancellations mixed with the Web site's problems might leave some people who have coverage now uninsured in the new year.

These are Obamacare's biggest losers: People whose current plans have been canceled but who are having trouble getting through HealthCare.Gov to purchase coverage by Dec. 23 -- the deadline for buying insurance that begins Jan. 1.

The concern is particularly acute for patients with expensive medical conditions, who rely on their coverage for doctor visits and drug refills that would otherwise break the bank.

Even with HealthCare.gov improving and enrollment numbers rising -- approximately 1.2 million people have gained coverage since October -- there's still concern about what happens if this particular population falls through the cracks.

“As we approach the end of the month, there is set of chronically ill people for whom a coverage gap is a big deal,” says Caroline Pearson, a vice president at research firm Avalere Health. “These are folks who use a lot of drugs and a lot of services and could potentially have. We haven’t left them very much time.”

Those facing a potential coverage gap include an estimated 15 million people who purchase coverage for themselves on the individual market, many of whom received cancellation notices because their policies did not meet health-care law requirements.

“I’d certainly like to have continuous coverage for the peace of mind,” says Rich VanMetter, a 64-year-old D.C. resident whose Kaiser Permanente plan will end this year.

VanMetter only wants to purchase coverage for January and February; he turns 65 in March and will then qualify for Medicare. But his application with the D.C. HealthLink has been held up in the identity verification process, requiring him to fax in copies of his driver’s license.

“Ever since I got my first job in 1977, I’ve had continuous coverage,” he says. “Suppose I slip on the ice and break my arm. I’m 64. Anything can happen, so having insurance is extremely important.”

Health and Human Services Secretary Kathleen Sebelius told Congress Wednesday that the cancellation of a private plan should not be equated with losing coverage.

"I know people have been told their health plan doesn't necessarily match the Affordable Care Act requirements," she said. "Losing coverage and being notified that the plan they have doesn't exist anymore are two very different things."

There are also approximately 300,000 Americans receiving coverage through state-run high-risk plans, which provide subsidized insurance to residents who insurance companies have rejected because of preexisting conditions. About two-thirds of them will lose coverage at the end of this month. These programs tend to cover some of the sickest patients, whose monthly medications can cost upwards of $60,000 without coverage.

“For some of the high-risk members, it's a matter of life or death,” says Tanya Case, executive director of the National Association of State High Risk Pools. “We have many members who are on specialty medications that they have no way of affording on their own.”

Case says that the Center for Consumer Information and Insurance Oversight at Health and Human Services has directed the federally-funded high risk pools to call each and every enrollee to find out whether they have successfully enrolled in health-care law coverage. Those calls began this month, and will continue through this week.

While those calls are still on-going, Case says she hears from members of the high-risk pool she runs in Oklahoma who are successfully enrolling in less than an hour -- and those who are still having difficulty.”

“It’s a mixed bag,” Case says. “One of the things we’re seeing our members tried to enroll really early, because we had impressed on them how important it was. It became such an emotional issue, and now they’re just paralyzed in the process.”

One other challenge for patients with high medical bills has been figuring out which health insurance plans on the exchange meet their specific needs. Hemophiliacs, for example, can require $100,000 in monthly prescriptions -- making it crucial to determine whether a particular plan covers their medication.

Information on doctor networks and drug formularies is not typically available on the exchange. Instead, shoppers need to visit each individual plan’s Web site to track down that information.

“On the one hand, especially if you’re in a situation like a cancer patient and need ongoing coverage, you need to just pick a plan,” says Marc Boutin, executive vice president at the National Health Council, which works with patient advocacy groups. “In an ideal world, you’d be able to get an estimate of who is in your network. It’s frustrating, from our perspective, because we think that should be built in.”

The health-care law does include some protections for those who might select an inappropriate plan. It limits maximum cost-sharing to $6,350 for an individual -- still a significant amount, but also much less than some specialty medications.

“That’s better than not having coverage, but it also means you’re going to be hit with $6,000 in bills before you can get care,” Boutin says.

Gisler in Utah has filed an appeal with the federal exchange and is hoping to eventually gain coverage through the marketplace. For his son, he sees the health-care law as a mixed bag. For the first time, he was able to gain coverage in the individual market despite having a serious medical condition. And his new premium is half of what he paid in the state program, which was about $700 per month.

But technical difficulties have prevented Gisler’s son from accessing the tax credit he believes he should receive. That would knock an additional $250 each month off his premium bill.

“It’s a net gain for us, that preexisting conditions no longer preclude coverage,” Gisler says. “But in terms of the government’s ability to process us through the system, they’re still working on that. We’ve given up. We don’t even try anymore.”

KLIFF NOTES: Top health policy reads from around the Web.

HHS is in the process of “hand-matching” thousands of enrollments. “The Department of Health and Human Services (HHS) is manually fixing thousands of flawed enrollment transmissions sent from HealthCare.gov to insurance companies in October and November, Congress was told Wednesday. "We are in the process of actually hand-matching individuals to insurance companies,” Secretary Kathleen Sebelius said in testimony to the House Energy and Commerce Committee.” Jonathan Easley in the Hill.

Obamacare enrollment is gaining pace, but still behind projections. “About 365,000 Americans chose health plans during the first two months of the federal and state insurance marketplaces, bringing the total to more than triple the meager enrollment from October, according to new figures issued by the Obama administration. The report shows that the number of people who collectively signed up for coverage in the 14 states running their own insurance exchanges continued to outpace the total enrollment from the three dozen states relying on the federal marketplace.” Amy Goldstein and Lena Sun in The Washington Post.

Congress is inching closer to a 3-month doc-fix. “Congress is planning to patch Medicare's flawed physician payment system for three months, sparing doctors from a substantial pay cut on Jan. 1, a GOP source told the Hill.  A short-term "doc fix" would set the stage for lawmakers to permanently repeal and replace Medicare's sustainable growth rate (SGR) early next year. “ Elise Viebeck in the Hill.

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