Thursday, June 25, 2009

Stop Gap Stop Loss

President Obama's net network is flooding Congress and the airwaves with the health insurance and health access horror stories submitted by citizens. David Lazarus, business columnist for the Los Angeles Times has one (actually, two) to add to the pile:

The state's Major Risk Medical Insurance Program is meant to serve as a last resort for the up to 400,000 Californians who have been rejected for health coverage by private insurers because of medical problems.

But it's not easy to get into. It's not comprehensive. And it's not cheap.

Los Angeles residents Susan and Stephen Perry recently turned to the program after being shown the door by money-minded private insurers.

Susan, 62, a freelance writer, was diagnosed with ulcerative colitis, a digestive disorder, four years ago. Stephen, 58, a part-time teacher and a poet, has Type 2 diabetes.

"We're spending all our retirement cash," Susan told me. "But this is the only insurance we could get."

The program is clearly well intended. But it shows just how bad our healthcare system is for those who fall into the cracks -- and how the pursuit of even limited coverage can wipe out a family financially.

The Perrys had been covered by insurance offered by PEN American Center, an organization of writers and artists, until they received notice recently that their combined monthly premium would soon top $2,000.

So they went shopping for coverage among private insurers and discovered that their business wasn't wanted -- by anyone.

That left only the Major Risk Medical Insurance Program, which charges the Perrys $1,746.29 a month for coverage provided by Blue Shield of California. That's almost $21,000 a year.

For that, they enjoy a relatively low $500 annual deductible. But they also face an annual cap of $75,000 in payouts. God forbid if one of them suffers an expensive illness or injury. ...

The Major Risk Medical Insurance Program, or MRMIP -- pronounced "Mister Mip" -- is essentially catastrophic health insurance that doesn't cover catastrophes.

It's last-ditch insurance that's intended to safeguard hundreds of thousands of Californians turned away by private insurers but that lacks the funds to cover more than 7,100 people at any given time.
[Emphasis added]

The $75,000 annual cap may look generous, but expensive procedures such as cancer treatment can cost well over $100,000. So would hospitalization for a heart attack, or, more likely in Mr. Perry's case, treatment for one of the dreaded "-opathies" that accompany diabetes: retinopathy, neuropathy, nephropathy. About the only "catastrophies" that are covered by MRMIP are such things as a badly shattered bone that requires surgery and a hospital stay. For that, the Perrys are paying over $20,000 a year.

The California program is a laudable try, but it is simply inadequate. It has been underfunded in the past, and probably is going to be one of the projects that will be cut even further by the mad slashers in the Schwarzenegger administration given the job of cutting state services to punish the electorate for not passing the budget proposals recently put before them.

If ever a story illustrated the need for a single payer system that would cover all the people, regardless of pre-existing conditions, the Perrys' story is it. A copy of the article should be faxed/emailed/mailed to people like Max Baucus and Dianne Feinstein, people who have free and total coverage themselves, but apparently think it would be "too expensive" to offer the same to us common folks.

Do it.

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