Health Insurance

Betting on Reno

Editor’s Note: This is the third in a series of articles on the Athens uninsured initiative, produced by graduate students in the Health and Medical Journalism Program at the University of Georgia. Visit the previous article by clicking on the red button to the left.)

Patricia Thiessen was driving in her hometown of Reno, Nev., when she suddenly lost the sight in her right eye. It returned within moments.

Six weeks later, the same thing happened to her left eye. It was obvious something was seriously wrong.

Thiessen, who does not have health insurance, went to her local hospital and took advantage of a free screening offer she had received in the mail. She discovered she was suffering from carotid artery disease, which would ultimately increase her risk of stroke. Plaque buildup in the arteries was blocking the blood flow to her brain and causing the episodes of blindness.

The hospital referred her to a cardiologist, who informed her that she would need two surgeries to unclog the arteries. The bill would be close to $60,000.

Thiessen was working part time as a cosmetologist and caring for her disabled brother and sister. “The cost of health insurance was out of my range,” she said. “It was like a thousand dollars a month.”

The high cost was because she would have to buy an individual policy, and she had a history of skin cancer. The Affordable Care Act had not fully kicked in yet, and insurance companies could still penalize people for pre-existing medical conditions.

“Literally, I would have been paying off medical bills for the rest of my life,” said Thiessen, who at the time of her vision scare was 64, a year away from qualifying for Medicare. Waiting that extra year and gambling on her eyesight wasn’t an appealing option.

Fortunately, a billing coordinator in the specialist’s office told her to call Access to Healthcare Network (AHN), a coalition of health care providers in Nevada and the state’s only nonprofit medical discount plan.

Athens will soon become the first Georgia community – in fact the first community outside Nevada – to implement a plan like the one that helped Thiessen. The Athens Health Network will launch next year.

Fast action in urgent cases

The experiences of consumers and physicians in Reno give us some idea of what to expect.

Members of the network pay a monthly fee that gives them access to a large number of specialists, clinics and hospitals where they pay cash – at deep discounts – for the care they receive.

Thiessen called AHN on a Friday afternoon, and a staff member quickly set up the two procedures she needed to restore blood flow to her brain.

The hospital charged her $800 for each procedure, performed earlier this year. Factoring in the payments to the surgeons and anesthesiologist, Thiessen paid about $4,500 total – compared to an estimated $60,000 she would have owed without AHN.

“It would have been $44,000 just for the hospital,” she said.

Thiessen is one of nearly 600,000 Nevadans without conventional health insurance, and one of roughly 8,000 who now have access to affordable care because they have joined AHN. In Georgia, an estimated 2 million people are uninsured, and in Athens about 5,000 of them would be eligible to join a plan like AHN.

As the Affordable Care Act, the 2010 federal health care law, moves forward, many Athens-area residents will still be in need of this nonprofit medical discount network, especially if Georgia does not expand its Medicaid program under the act.

Easing hassles for caregivers

When it comes to specialized care, “we are the funnel for the rest of the northern half of Nevada,” said Trevor Rice, the member services director for AHN.

Before AHN was created, “People couldn’t get specialty care at a price they could afford, so it just didn’t get done,” Rice said.

As a result, there was a “pent-up” need for care before AHN was launched seven years ago, and lots of early members needed attention from surgeons and medical specialists. But AHN’s rate of referrals for specialty care has decreased in the years since, Rice said, probably because that backlog of unaddressed problems has been cleared.

Although AHN is a “shared responsibility” model, meaning that members, while getting reduced rates, still have to pay for care, “most of our providers would probably view us as a charity program,” Rice said.

“Therefore it’s all about the relationship,” said Rice. The organization works hard to ensure that being part of AHN is as little hassle as possible for health care providers.

In Athens, an uninsured person with carotid artery disease needing immediate surgical attention, like Thiessen, would have found it nearly impossible to get surgery at an affordable price.

Since many specialists in Clarke County don’t accept patients that are uninsured or on Medicaid, many low-income patients who receive primary care at community health centers or free clinics either go without specialty care or travel long distances to get what they need.

Ian Branam is a freelance health and science writer currently pursuing a master’s in health and medical journalism at the University of Georgia. Ian has bachelor’s degrees in history and psychology from the University of Georgia. He is particularly interested in writing about public health, epidemiology, and the environment. Follow on Twitter as @ianbran6

Gerald Kogon and Sloane Jenkins have the hearing aids they need because their families can afford them. Many families can’t.

Gerald Kogon was born three years ago with bilateral hearing loss.

The family’s health insurer didn’t cover the hearing aids he needed, says his mother, Sara Kogon of Sandy Springs. Fortunately, she adds, the family can afford to pay for them out of pocket — which amounts to $5,000 to $6,000 every three to five years.

The situation is similar for the parents of Sloane Jenkins, also 3. They can afford the hearing aids she needs.

But many parents with hearing-impaired children live on very tight budgets. They struggle to find the money for hearing aids.

“We are really concerned about so many of these families,’’ says Sara Kogon.

She and Kelly Jenkins are among parents who have pushed for a bill in the Georgia General Assembly that would require insurers to cover hearing aids for children.

Twenty other states have such laws, with another 10 working on them, the two women say.

But enactment of such a law in Georgia is not on the immediate horizon.

Georgia House Bill 74 isn’t going anywhere during this legislative session. Nor is another “mandate’’ bill requiring coverage for medical foods for metabolic and genetic disorders, and food tolerance and absorption disorders.

A third bill, which would require coverage of “evidence-based’’ treatments for autism, is also stalled.

All three of these proposed measures have passionate supporters among parents and other advocates. But all three face a built-in hurdle.

The year when nothing happened

A law enacted two years ago requires that any legislation that would mandate some form of insurance coverage must go through a commission. The panel must assess the social and financial impact and the medical efficacy of the proposed benefit.

And the panel has not even met yet.

The 2011 legislation required the commission to meet last year, and also to review existing mandated benefits. But neither of those things happened.

The commission’s first meeting will occur March 12. That date is likely to fall after Crossover Day, the day during any legislative session when a bill must have passed at least one chamber or be dead for the year. So the insurance coverage proposals have effectively run out of time in 2013.

Gov. Nathan Deal last week announced members of the commission, ranging from physicians to corporate officials and insurance officials.

“The mandated benefit commission serves an important role of developing cost-benefit examinations for proposed health insurance mandates,” the governor said in a statement.

“Unfortunately, the current health insurance market is largely unpredictable because of the changes required by Obamacare,’’ Deal said. “It is important to analyze proposed mandates in light of the new laws in order to fully vet their impact both socially and financially.’’

State Rep. Richard Smith (R-Columbus), who’s chairman of the House Insurance Committee and a member of the new commission, noted last week that the mandates, even if passed, don’t apply to employers that “self-insure’’ their benefits — most large and medium-sized companies.

And self-insured companies cover an estimated 65 percent of Georgia employees who have private insurance.

Graham Thompson of the Georgia Association of Health Plans says the commission is a prudent way to study the effect of these various kinds of coverage. He says any newly passed mandates must be paid for by state funds in the coming health insurance exchanges, part of the federal health reform law.

Opponents of mandated coverages argue that they add to the price tag of health insurance, making coverage unaffordable for small businesses and individuals.

Still, parents and others have pushed hard to move their legislation forward.

The autism legislation, supporters say, would cover speech, occupational and physical therapy, as well as behavioral therapy, for children.

Rep. Ben Harbin (R-Evans), chief sponsor of the autism legislation, House Bill 309, told 11alive recently, “There are powers that be that don’t want to see it moving.”

“The downside if this is delayed a year [is] . . . another year of therapy that these children aren’t getting,” said Harbin. ”There’s a tremendous impact on their quality of life down the road.”

Harbin also raised questions about the validity of the mandate commission law, since the state took no action last year to follow the law by convening a panel. “It’s not like they missed it by a few days,’’ he said. “We’re talking about an entire year delay.”

But Sen. Tim Golden (R-Valdosta), who was lead sponsor of the mandate commission law, told 11alive that the commission’s failure to meet doesn’t call the law itself into question. “It’s still an important committee that’s going to do important work,” Golden said.

Activists take the long view

Supporters of the autism coverage rallied recently at the state Capitol, pushing for a hearing on their bill.

Judith Ursitti, state legislative director for Autism Speaks, an advocacy group, says 32 states have passed a similar autism law. The autism coverage in Georgia has been a multiyear effort.

Without these mandated requirements, the vast majority of insurers don’t cover these therapies for autism, Ursitti says.

“This is personal with me,’’ says Ursitti, who has a 9-year-old son with autism. She lives in Boston, but she and her husband have ties to Georgia.

The extra coverage would cost 32 cents per member per month, she says. The delay in passing the legislation, she adds, “is excruciating when you think of the impact on human lives.’’

Most insurance companies in Georgia also don’t cover hearing aids, Kogon says, adding that a mandate would cost just 25 cents per year per covered person.

“Everyone said Georgia doesn’t do mandates,’’ Kogon says. “We’re optimistic.”

She points out that government programs Medicaid and PeachCare cover hearing aids for children.

Kogon understands the battle may be postponed till 2014, but intends to be part of it. “This is right for the children of Georgia,’’ she says. “We’re not going away.’’

The U.S. Supreme Court had a major effect on Georgia health care in 2012. Photo by Chris Phan

Here is the GHN list of the Top 10 stories in Georgia health care in 2012.

Disagree with our choices? Let us know with a comment or email.

10. Grover Norquist’s letter to lawmakers on the Georgia provider fee.

The national anti-tax leader stirred up the debate on the hospital fee before the 2013 General Assembly session.

 9.  Consolidation continues among hospital systems and insurers.

Examples of the cost-cutting combinations were WellPoint buying Amerigroup, Mayo Clinic taking over a Waycross hospital, and Emory partnering with Southern Regional.

 8. Gov. Nathan Deal announces a public-private partnership to fight obesity.

Georgia’s rate of child obesity is the second-highest in the nation.

7. The U.S. Supreme Court hears arguments against Phoebe Putney’s merger with Palmyra.

The FTC challenges the Albany deal, saying it will lead to a monopoly and higher prices.

6. Baxter International announces it will build a manufacturing facility in Georgia.

The biopharmaceutical plant will bring 1,500 jobs to Stanton Springs.

5. A young Snellville woman survives a battle with a rare flesh-eating bacteria.

Doctors gave a grim prognosis for Aimee Copeland, 24, who lost parts of limbs, but her courage made her a national inspiration.

4. Piedmont Healthcare and WellStar Health System form an alliance.

The metro Atlanta hospital superpowers announce they will create a health insurance plan.

3. Two famous Georgia centenarians die.

Besse Cooper, 116, was listed as the world’s oldest person; Leila Denmark, 114, was a renowned  pediatrician and author.

2. Gov. Nathan Deal’s makes his choices under the Affordable Care Act.

The governor declines to build a state insurance exchange, and rejects expanding Medicaid as it’s currently outlined.

1. The U.S. Supreme Court upholds the Affordable Care Act, which Georgia and several other states had fought.

In a surprising ruling, the justices say the 2010 health reform law’s individual mandate is constitutional, but they put the choice on Medicaid expansion back in the hands of the states. (With President Barack Obama’s re-election, the law is safe from repeal and will go forward.)

Savannah-based Lummus Corp. makes cotton ginning equipment such as the machinery pictured above.

Four years ago, Lummus Corp. decided to do something very different on health care.

The Savannah-based company, which makes cotton ginning equipment, had dealt with grinding increases in health costs every year, with premiums under regular insurance plans jumping 17 percent to 34 percent annually.

But in 2008, the privately held Lummus became a member of the Savannah Business Group and began self-insuring its own benefits –- and buying health care together with other employers in that coalition.

The Savannah Business Group contracts directly with hospitals and doctors, bypassing the typical set-up with health insurers.

The payoff for Lummus has been startling.

With 148 employees, Lummus has seen its health costs flatten out in the past four years –- rising no more than 5 percent a year. In addition, says Sharon Herrera, Lummus’ human resources director, the company has improved employee benefits. Copays for medications have been lowered and  wellness benefits have been added, along with other benefit enhancements for workers.

“We believe we’ve improved the health of our employee population,’’ Herrera says.

The Savannah Business Group has been a major player in coastal Georgia since the 1980s, helping self-insured employers buy health care at a more affordable price.

SBG has 28 employers, with workforces ranging from 50 to 6,000, as members. Eighteen of these employers — including the City of Savannah itself — directly purchase health care together, using the coalition’s preferred provider network.

The key to success of this effort, say the coalition members, is that the employer group negotiates directly with hospitals and doctors, using a ‘‘third-party administrator’’ but forgoing the traditional health insurance route. Each employer member still designs its own benefits plan.

It’s the only employer coalition of its kind in Georgia.

A model for exchanges 

Huge corporations have it easier buying insurance than smaller companies, says Gary Rost, executive director of the Business Group. “Very large employers can usually ask for something and get it from an insurer,’’ he says.

But the coalition’s members can function together with as much power as a large corporation. “Our ability to work directly with doctors and hospitals in a community is very valuable,’’ Rost says.

Many employer coalitions have formed for health care purposes around the country. But the National Business Coalition on Health, which has 56 employer groupings around the nation, says only about a dozen of them have a health care purchasing function like Savannah’s.

“It’s not an easy model to put together,’’ says Andrew Webber, CEO of the National Business Coalition. The coalitions face competition from insurers and must deal with the complexity of negotiating contracts, he adds. “In a way, it’s a mini-insurance company,’’ Webber says.

Employers working together to raise their buying clout is something that the health reform law of 2010 envisions doing through insurance exchanges, with small business banding together to purchase coverage based on price and quality.

That combination is behind the hot new concept in health care, “Value-based purchasing.’’ That’s the payment model wherein quality of services, and not quantity, is rewarded.

SBG’s Rost says quality of care is one of four areas the group judges in its request-for-proposals process.

The coalition reviews patient outcomes from the Centers for Medicare and Medicaid Services and measures reported by Leapfrog, which monitors safety and quality of hospitals. It pays attention to hospital infection rates and patient readmissions.

“Savannah’s hospitals are some of the best in the nation and are in top 10 list for Georgia,’’ Rost says.

Dr. Jules Toraya, a Savannah ob/gyn whose practice is part of the SouthCoast Medical Group, said that for him as a physician, the SBG arrangement is easier than dealing with an insurance company, and pays similar to a commercial insurer for medical services. (SouthCoast is also an SBG employer member.)

Questions of judgment

But the negotiating process isn’t always without controversy.

Recently, the Savannah Business Group recommended renewing its contract with St. Joseph’s/Candler system, and the Savannah City Council ratified the decision.

Rost says St. Joseph’s/Candler’s rates were 11.5 percent lower than than those of its rival, Memorial Health.

“Both had great rates,’’ Rost says. “St. Joseph’s had the better pricing structure.’’

But Memorial’s president and CEO, Maggie Gill, publicly challenged that assessment, according to a Savannah Morning News article.

“After we agreed to reduce our rates even further, that [price] spread no longer exists,” she said in the article. “What I don’t understand is how, in this era of transparency and openness, can you blindly trust a third party [SBG] to evaluate your rate?”

Gill also stressed that Memorial offers specialized care, including neonatal care, specialized eye surgery and other services not offered at St. Joseph’s/Candler.

Coalition members interviewed by GHN say the cost of coverage remains a huge priority.

David Deason, human resources director for Colonial Group Inc., an oil and gas distribution company with 300 local employees, says his firm’s health increases have been in the range of 6 percent to 10 percent annually.

“You can’t sit on the sidelines,’’ Deason says. “This is your money. You have to roll up your sleeves and do the work. This is the only way to go.’’

Herrera of Lummus says, “Most of the people who came to work here have not had health insurance, or have lost it.’’

Insuring them helps taxpayers avoid the costs of care for the uninsured, she says.

SBG members ‘‘have a passion for what we’re doing,’’ Herrera says.

The Savannah Business Group, she adds, “has been extraordinary in helping us achieve this.’’

Liz Johnson says she and her partner owe a substantial amount from unpaid medical bills.

Liz Johnson and Robert Irby have diabetes and other medical conditions, so having insurance has been crucial to them.

The Nicholson couple, who are self-employed, had individual policies with high deductibles through Blue Cross and Blue Shield of Georgia.

Early this year, their monthly premiums jumped by about $100, reaching $628 for him and $677 for her.

The couple had automatic payment online through their bank. But they did not immediately adjust the amount paid to reflect the new premiums.

When they realized their mistake, they say, they sent in the extra money. But Blue Cross and Blue Shield of Georgia, their health insurer, sent the money back and canceled them.

The insurer, replying to a query about the situation from GHN, said in a statement that if a member’s premiums are paid through an online bill pay program via a bank, a member must alert the bank of any changes in amount.

Blue Cross does consider requests for reinstatement, but denied the couple’s request, Irby says.

Such individual health insurance policies have long been problematic for many people, especially those with health conditions.

Reason for cutoff disputed

A 2009 AJC investigation found that individual health policies drew a disproportionately high number of complaints to the Georgia insurance commissioner’s office. Not only are premiums for these policies high, and subject to big increases, the coverages can be relatively limited, the AJC found.

Johnson said she believes that the two were cut off because of their past health issues, a suggestion that Blue Cross and Blue Shield firmly denies. “We do not terminate policies based on claims history,’’ the company said in a statement.

The state’s insurance commissioner’s office says policy cancellations are not common complaints in Georgia now, and that only a handful were received from January 2011, when the current commissioner took office, through May of this year.

The problem of pre-existing conditions, though, has remained an enormous barrier for people getting affordable coverage. It has adversely affected millions of Americans, keeping them from changing jobs due to fear of losing insurance, and leading to insurers routinely rejecting applicants for individual coverage, or setting sky-high premiums.

Johnson’s and Irby’s cutoffs came in February, three months before the Supreme Court upheld the Affordable Care Act (ACA), the federal health law sometimes called Obamacare. Since the ruling late last month, Republicans have mounted a renewed effort to repeal the ACA through congressional action.

Georgia tea party activist Debbie Dooley, a staunch opponent of the two-year-old law, told the AJC recently that regarding “pre-existing conditions — we are deeply concerned about that — but Obamacare is not the solution to that because it will drive up insurance costs.”

Advocates of the ACA, however, note that it is designed to help people with certain health conditions, such as Johnson and Irby, in important ways.

Under the law, Johnson and Irby will be eligible for the state Pre-Existing Condition Insurance Plan, created for ‘’high risk’’ individuals like themselves. More than 1,000 Georgians with health conditions belong to this new health plan. The couple must be uninsured for six months before joining PCIP.

Johnson says she has looked into the PCIP and says, “It might be cheaper than what we had.’’

In addition, beginning in 2014, health plans will be barred from denying coverage to people with pre-existing conditions, and also won’t be able to charge them discriminatory premiums. And people with health problems and individual policies will be able to access private coverage through an insurance exchange, which should lower premiums for many consumers buying on their own.

Anxiety about being uninsured

In the meantime, though, Johnson and Irby are worried about the costs of their care.

Johnson, 56, a real estate paralegal, had a blood test done in February. Insurance has usually covered a good portion of her tests, she says, but this time “they covered nothing.’’ She was canceled briefly in 2010, also because of a payment problem, but was reinstated after three months.

This time, Irby, who tends to their small horse farm, called Blue Cross and asked to be reinstated, noting that they sent in the extra money, but he says the company told him no.

He takes Lantus, a form of insulin, twice a day, going through a $100 bottle each week. He also has high blood pressure and a serious leg problem. At 64, he’s a year away from qualifying for Medicare, the programs for seniors and the disabled.

Under the current insurance rules, the two are essentially uninsurable, except for the possibility of the Pre-Existing Condition Insurance Plan.

Johnson has been hoping that nothing goes wrong healthwise while they’re uninsured.

Like many Georgians, Johnson has serious reservations about the ACA. She cites, as one example,  how the complex legislation was passed in Congress.  “I think it went through too fast,’’ she says. But she’s willing to look again at the law and the coverage it offers to people like her.

“Money is tight,’’ she says, adding that she and Irby still owe medical bills.

“We owe everybody money,’’ she says.