Lisa Blais: RI’s Obamacare Landscape: Got Coverage?

Thursday, October 10, 2013

 

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Obamacare in RI, in the form of HealthSourceRI, was created by Governor Chafee’s executive order. This means that the RI General Assembly did not have a hand in approving the costs associated with this new government entity. It was conceived, built, and a payroll was created to deliver an on-line marketplace and to open a brick and mortar office to sell insurance to small businesses and individuals in our state. In anticipation of federal funds running dry, the state (taxpayers) must now come up with the approximate $24 million required to support HealthSourceRI. Given that this was not passed with statutory authority it is a rather backward way of creating public policy. But this is “old” news in context of the fast paced news cycle in our tiny state.

What does remain newsworthy and timely is that most people are in the midst of wrapping their heads around what HealthSourceRI means to uninsured Rhode Islanders, small and large businesses and their employees and taxpayers.

Just last week Rhode Island College held another series of their Publick Occurrences about Obamacare in Rhode Island while this past Sunday, Channel 12’s Newsmakers interviewed Christine Ferguson, Executive Director of RI’s health insurance exchange, HealthSourceRI.  

Ms. Ferguson also appeared on WPRO talk radio with some discussion about the $800,000 tab for advertisement aimed to raise the awareness of HealthSourceRI across the state.  This author wrote her most recent two MINDSETTER articles on the same topic which can be found here and here and was invited to talk about the impact of HealthSourceRI and some of its finer details on WNRI.

With such newsworthiness, we decided again to look closely at some of the insurance plans offered to individuals through HealthSourceRI with catastrophic coverage in mind.  By catastrophic coverage, we mean insurance coverage in the event of hospitalization. After all, aside from the obvious benefits of seeking preventative care, we are all mortal and may face the extraordinary costs of having to be hospitalized at some point in time. A stay in a hospital can potentially be a very costly occurrence to say the least. Many people worry that entering the hospital without coverage can pose the threat of losing one’s home or going bankrupt  as a result of facing an onerous bill at the end of that hospital stay.

Got Coverage?

So, with the notion that folks who share the common concern that health insurance is necessary to have in the event of hospitalization or on the flip side, those who don’t purchase insurance or those who can’t afford to buy it are running a grave risk if something should happen to them, we looked at what HealthSourceRI’s plans offer for hospital stays.

Frankly, we made the mistake of anticipating that full hospital coverage would be available through RI’s insurance marketplace.  From a layperson’s perspective, we think that most individuals would expect to find some insurance choices that offer full coverage for a stay in a hospital especially given that the associated premiums for the insurance easily reach into tens of thousands of dollars per year for just two people.  (This reference to cost is not withstanding eligibility for the taxpayer subsidized premium subsidy). After all, just walking through the door of an emergency room can rack up thousands of dollars in costs (average cost of an emergency room visit according to one BCBSRI representative is $988)before one may even be seen by a medical provider never mind the associated costs after a potential admission to that hospital. 

The plans offered to individuals on HealthSourceRI are dominated by Blue Cross Blue Shield of RI – the same insurance carrier that has long sold insurance to individuals under their “Direct Pay” purchasing system. Not a single one of these plans offer 100% coverage for in-hospital stays after paying the now commonplace requisite deductible.

Not trusting our eyes, we called HealthSourceRI to inquire if we were missing something! Two different representatives (yes, we made two separate calls) confirmed what we found.  But, in fairness, let’s ask the obvious question when it comes to including hospital coverage in their plans. Is it offered anywhere else in RI? The answer is “yes”.  Blue Cross Blue Shield offers a variety of plans that share common names whether offered through HealthSouceRI or through business associations. You may know them, for example, VantageBlue or VantageBlueSelectRI. Same names, different coverage depending on where you access your health insurance.

Even “curiouser” is the fact that these plans can be had (this year) through a business association for less premium (still crazy expensive, though) with 100% in-hospital coverage after meeting the deductible than the plans of the same name through HealthSourceRI which are offered at higher premiums without the same in-hospital coverage.

Here’s an example. VantageBlue can be purchased through a business association with a $2000 deductible and $0 cost for in-hospital stays with an out of pocket maximum of $6000. VantageBlue plans are available through HealthSourceRI but they require 20% co-insurance for in-hospital stays with varying deductibles and out of pocket maximums.

Never mind those thoughts of risk pools or the fact that taxpayers must subsidize Obamacare for it to survive! Just look at this one particular idiosyncrasy in RI. We are a small state with little market competition. Why would the dominant health insurer in our state offer up plans of the same name with very different in-hospital coverage?  Why hasn’t HealthSourceRI offered up, for public consumption, what efforts they may have made to provide a plan that covers in-hospital stays? Nope, we’re not naïve and the question is worth raising especially in light of the marketing campaign, all the talk about access to affordable healthcare and – don’t overlook this one – the fact that most folks don’t read the fine print!

The bottom line is that BCBSRI would charge even heftier premiums for in-hospital stays and likely believe that they wouldn’t sell enough of those individual plans to be viable.  Juxtapose that against what is most important to many people when it comes to health insurance. Further, consider the fact that all premiums will increase at the very least by a range of 2% – 5% just as a result of premium surcharges to cover the Obamacare taxes and our very own costs to support HealthSourceRI.

In the spirit of full disclosure, we suggest that with all of the recent news coverage on Obamacare in RI and specifically, HealthSourceRI, that the finer details of what coverage folks can and cannot access should be fully vetted.

Lisa Blais is a board member of OSTPA, a taxpayer advocacy organization in Rhode Island.

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