Seven-year-old Alex Rowe, who has a rare bleeding disorder, soon will have private health insurance again.
He is among more than 5 million Americans under the age of 19 with a pre-existing medical condition who cannot be denied coverage by insurance companies beginning as early as September under a key provision of the health care reform law. Covering consumers with pre-existing health problems has long been a point of contention and figured prominently in the national health reform debate.
The provision in the law also means more doctor choices for consumers who have been forced to pick up government coverage like Medicaid health insurance for the poor, which typically pays medical providers less money.
Although most of the benefits intended to expand health insurance to more than 30 million Americans don’t kick in for another four years, certain tenets of the bill passed three months ago by Congress and signed into law by President Barack Obama will provide new coverage options in late September, once health plan renewals begin. Observers say these tenets will be more clearly defined, unlike some of the regulations that still have to be worked out between now and 2014.
“We are very limited in our choices until this law kicks in,” said Christine Rowe, who was let go from her suburban Philadelphia job as a subprime-mortgage underwriter two years ago, and with it lost the private benefits that covered her sick son.
Rowe anxiously sought to find private health insurance, to no avail.
Although she and her self-employed husband were able to get a family policy for themselves and daughter, their son was not covered because he has von Willebrand disease, a rare disorder that prevents the blood from clotting. Diagnosed shortly after birth, Alex needs more than $30,000 a month of a special clotting medication.
“We were denied, denied and denied coverage for Alex,” Rowe said. “I knew what the answer from the insurance companies was before I even applied. We were denied more than a dozen times.”
The last option for the Rowes was to join Pennsylvania’s Children’s Health Insurance Program, a common way states cover poor children and those who cannot get health benefits from other sources. But because Medicaid and related programs tend to pay medical care providers less than private insurers, the Rowes found themselves with limited options for Alex.
“I had to change my pediatrician because my pediatrician did not take Medicaid,” Rowe said. “And I had a home care company that came to my house to help me infuse Alex (with his medicine), but we had to lose them and go with a different company. You need to be allowed to shop.”
Once fully implemented, health reform is designed to give consumers more choices and allow individuals and small groups without employer-based coverage the chance to buy insurance on state-regulated exchanges.
The insurance industry has argued that covering people with pre-existing conditions is possible only if everyone is required to contribute premiums. Analysts say covering children with pre-existing conditions first would be easier because it involves a smaller group and is less expensive to the federal government.
Children account for nearly 9 percent of the estimated 57.2 million Americans under age 65 with pre-existing medical conditions, which can range from deadly types of cancer to routine chronic conditions such as high cholesterol levels or hypertension.
The bulk of those with pre-existing conditions, more than 28 million, are between ages 45 and 64 and tend to have chronic issues that would use more resources, according to a report released last month by Families USA.
“This is a confidence-builder in what health care reform does,” said Ron Pollack, executive director of Families USA, a Washington-based consumer health advocacy group that long pushed for expanding health coverage. “It’s a popular group to reach out to … and it’s not going to have as big of an impact on costs such as, say, somebody between the ages of 55 and 64 who has multiple chronic conditions.”
While Congress wanted to start implementation immediately, the law won’t take effect until Sept. 23. Some private insurance carriers are not ruling out complying earlier, pending regulations on final implementation, which is expected soon from the Obama administration.
“It would not surprise me if insurers would undertake this earlier,” said Illinois Insurance Director Michael McRaith.
Critics of the health care reform law have complained that implementation will be too expensive, an estimated $100 billion a year over the span of the first 10 years after 2014, when the bulk of benefits will be provided.
But the health insurance industry has been on board with “making pre-existing condition exclusions a thing of the past,” wrote health insurance lobbyist Karen Ignagni, chief executive of America’s Health Insurance Plans, in a March 29 response letter to Health and Human Services Secretary Kathleen Sebelius.
Since Congress passed health care reform, concerns have surfaced that insurers might try to find loopholes to deny coverage to children with pre-existing conditions or set unaffordable rates. Although the cost of obtaining insurance for those with pre-existing conditions can’t be predicted, it’s more likely to be manageable for people covered by larger insurers.
“Health insurance reform is designed to prevent any child from being denied coverage because he or she has a pre-existing condition,” Sebelius wrote in her letter to Ignagni.
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