It's good news for universal coverage. It's good that basic plans will cost less than thought possible a month ago. Kudos to Governor Patrick and Jon Kingsdale for this. Still, lower premiums aren't a gift from nowhere. Savings come from sick people's pockets. Alarms about high cost-sharing that accompanies low premiums are legitimate.
How bad is cost sharing in Commonwealth Choice?
Deductibles are capped at $2000 for an individual and $4000 for a family. This means, except for a few primary care visits, some people will pay this much before insurance begins covering their medical expenses. Out of pocket costs will have an outer limit, yet those limits are awfully high at $5000 for an individual.
Insurers have other ways to keep the premium down, and not just co-pays, which most of us are used to and a lot of us can stomach. Co-insurance is a new breed of wallet emptying. Co-insurance charges patients a percentage of the cost of a service, rather than a flat dollar co-pay. This is tough on consumers because most of us have no idea what 20 or 30 percent of any medical service costs. And these expenses can add up in a hurry.
All this cost sharing hurts people in their wallets. These costs deter many people from seeking the care they need.What Can We Do About This Now?The Connector board is lined up behind the cost sharing limits outlined above. (Actually, the health reform law - Chapter 58 - permits even larger levels of cost sharing than the Connector will permit.) Plan bids rely on these assumptions, so they are not likely to change. There are several areas on which to weigh in.
First, the Connector should ensure that all people can buy better coverage. Employees in Commonwealth Choice plans should be allowed to choose between higher and lower cost sharing plans. Employers should not limit employees to basic level plans. People should not have to sacrifice employer contributions to get decent coverage.
Second, the Connector must provide people with useful tools to choose a plan. Understanding cost-sharing differences is daunting. A clear, concise form allowing consumers to understand all costs and to compare products on benefits, cost-sharing and premiums is critical. Widespread outreach and individual counseling are essential if health reform is to succeed. People have to understand their real choices for health reform to succeed.
John McDonough is the Executive Director of Health Care for All.
This program aired on March 7, 2007. The audio for this program is not available.