The nation’s insurance companies will soon have to offer health plans to people like Daniel Gennari and Amy Swann — potential customers they would not have considered before.
The U.S. Supreme Court’s decision last week to uphold the health care law means that in 2014, insurers can’t consider the fact that Gennari was diagnosed with cancer in 2009 and that Swann will probably need a heart transplant.
Guaranteeing insurance for people with pre-existing conditions was a major focus of the law and addressed an issue that people of all political persuasions agreed was a problem. But whether the law will be able to pull off the complicated business of insuring the chronically ill without overburdening the healthy may be one of the greatest challenges in store for the Patient Protection and Affordable Care Act.
For those whose lives have been upended by cancer, diabetes, multiple sclerosis and many other conditions, the law would allow them the freedom to leave or lose a job, start their own company or dump one insurance company for another without the fear that they would forfeit their coverage forever.
Daniel Gennari, 34, said his network of Twitter and Facebook connections — which includes many young cancer survivors like him — exploded with excitement last week when the Supreme Court released its decision.
“I’m just glad that the right thing got done in Washington,” he said. “It’s definitely going to be helpful to me.”
As the nation’s insurance companies prepare to approach their business in an entirely new way, they worry about whether all the pieces of the law will fit together so that it benefits both the healthy and the chronically sick.
“We have long supported expanding coverage for people with pre-existing conditions, and millions of people are now going to be covered and that’s a great thing,” said Robert Zirkelbach, spokesman for America’s Health Insurance Plans, a trade association for the insurance industry. “If this is going to be something that can be sustained, we have to focus on affordability.”
Sharing the risk
By requiring most Americans to obtain insurance or pay a penalty, the health care law seeks to create a giant insurance pool filled with healthy people along with the sick. After all, that’s what insurance is all about: sharing the risk.
With that big pool in place, the law will then try to change the incentives for insurance companies, which in the past have pumped up profits by attracting healthy customers and rejecting those with costly medical conditions, said William Custer, a health care expert at Georgia State University.
Once insurers can no longer turn people down because of their health status, they will focus on trying to push the health care system to reinvent itself to focus on keeping people well, and providing high-quality, cost-effective care to those who get sick, Custer said. Insurers, hospitals and doctors are already trying to come up with new ways to pay for health care that will emphasize quality and results, instead of simply paying doctors and hospitals more based solely on the number of patients they see and the number of procedures they perform.
“The idea is to create a market where providers and insurers are competing on the basis of cost and quality and not on avoiding bad risks,” Custer said.
Will it work?
When 2014 hits, insurers won’t be able to charge people more because of their health conditions. They also won’t be able to mark up premiums as much for older people as they do now. Those requirements will drive up the cost of coverage for the young and healthy, Zirkelbach said.
“Faced with much higher premiums, a lot of those people may choose not to purchase coverage,” he said. “If people do that, that will drive up overall costs for everybody. You need to have those younger, healthier people to purchase coverage if you’re going to have a health care system that works.”
‘A $10,000 deductible’
Gennari was a 31-year-old husband, father and small business owner when he was diagnosed with Hodgkin’s lymphoma.
The Johns Creek man and his wife, Angela, own a company that plans meetings and conventions. Since they are self-employed, they have always purchased their own insurance and bought a new policy in 2008 with a $10,000 annual deductible and a health savings account — a popular type of coverage for people who buy their own insurance in the costly individual market.
The premium was an affordable $190 a month and seemed to be a good match for the family. “We’re young, we’re healthy,” Gennari thought, at the time.
Within months, Gennari got the diagnosis. The saga of trying to fight a disease while also dealing with insurance and medical bills began.
“When you get a $10,000 deductible plan, you never think you’re going to meet it within the first two months,” Angela said. “That was kind of a shock to our system.”
Gennari had eight months of chemotherapy in 2009. But a scan would soon reveal that his cancer had come back. He was admitted to Emory University Hospital for four cycles of aggressive chemotherapy, following by several weeks of radiation and then a stem cell transplant.
The good news: Gennari is doing well and experiencing the joys of being a father to his 5-year-old son.
“Day to day, things look normal,” he said. “I’m back at work. I feel good. If you looked at me, you would never think I was a cancer patient or that I still deal with it a lot. Business has actually improved — we had our best year ever last year.”
But the cost of the illness — and the Gennaris’ marriage to a high-deductible health plan — still hangs over their young family. Gennari’s cancer history means that he faces at least $10,000 in medical bills every year for the foreseeable future.
In 2014, however, the law will enable the family to shop around for a new plan that is likely to lower their out-of-pocket costs.
Gennari knows that lots of people object to the law’s “individual mandate,” which requires most people to have insurance or pay a tax. He hears the complaints all the times. But he says a brush with cancer can quickly change someone’s perspective.
“These are things that are good for all of society,” he said. “Health insurance falls right into that. We can’t advance as a group of people without some trust that we’re all going to have a fair chance of being healthy.”
‘Not the solution’
Georgia tea party activist Debbie Dooley asserts that the law is not good for society.
“We think Obamacare will effectively destroy the greatest health care system in the world,” she said. “Pre-existing conditions — we are deeply concerned about that — but Obamacare is not the solution to that because it will drive up insurance costs.”
Amy Swann sees it differently. The 48-year-old from Augusta believes she would be dead without the health care law.
Swann suffers from a genetic heart condition that killed her father at 46. A few years ago, Swann quit her job to care full-time for her ailing mother, who suffered from dementia. Her COBRA insurance eventually ran out. Her mother’s teacher pension checks, which had kept them afloat, stopped coming when she died last year.
Without insurance, Swann couldn’t get the treatments she desperately needed. Her heart began racing. She became bloated — gaining 25 pounds of fluid.
“I don’t think people understand that your life can change forever in a second,” she said. “A broken leg will put you into bankruptcy.”
Last August, Swann joined the Pre-existing Condition Insurance Plan after having no insurance for the requisite six months. Surgeons implanted a defibrillator in her chest late last year, and Swann said she’ll likely need a heart transplant at some point.
“I have to hang on to this insurance no matter what happens,” she said. “If President Obama had not pushed these policies through, I would be a dead girl walking.”
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