A Kaiser Foundation Misstep on Employer-Based Coverage for Cancer Care

How unfair. But it works.

Want to attack any process with a track record that is pretty good, considering the circumstances and alternatives? Look for individual instances of shortcomings and vaguely generalize them, making it appear that things are far worse than they really are. Given the complexity of insurance benefit designs and cancer coverage, the topic is perfect for this type of gamesmanship. And this is exactly what the Kaiser Family Foundation and the American Cancer Society (ACS) did here. By lining up 20 cancer victims who got tangled up in insurance benefit designs, the unsuspecting reader would conclude that when it comes to cancer, commercial insurance companies are either hopelessly broken (‘individuals may not be protected from high out-of-pocket costs’) or evil (force patients to ‘incur debt in order to pay for care…. or forgo or delay lifesaving treatment’).

The Disease Management Care Blog is not saying that each breakdown isn’t heart breaking or an opportunity to learn from mistakes. While this makes for a good narrative, this is not how to make good policy about the interlocking roles of deductables, cost sharing, out of network tiering, annual limits, lifetime limits and minimal coverage designs in the evolution of healthcare reform.

The truth is that faced with unrestrained medical costs, the vast majority of employers are successfully coming up with creative and functional health insurance designs. Without such creativity, there is either no health insurance for their employees or no staying in business for their customers. While the insurance may thin out, the fact is that for every example described in this Kaiser Foundation report, there are many other unseen examples of individuals who were able to use perfectly adequate insurance to access cancer screening and treatment. That piece of good news went decidedly unmentioned.

Instead, Kaiser and the ACS used anecdotes in combinations of highly unusual and lethal diseases requiring highly unusual treatments under highly unusual insurance designs. Toss in overpriced screening tests, docs cancelling their insurance contracts and rare employer stupidity, and you have biased report tilted away from locally controlled State-regulated or HIPAA protected employer-based insurance. That’s not necessarily bad, says the DMCB, but us citizens can’t rely on biased reports like this one to make an informed decision about the alternatives of a) greater State or Federal regulation, b) developing a tax-payer supported Federal insurance plan with first dollar coverage, no deductables, no coinsurance and no lifetime limits or c) a single payer system.

A rare Kaiser Foundation misstep.

Well, the DMCB to the rescue. It suggests you read the report, but keep in mind the inconvenient truths that follow below. You’ll be closer to getting your head wrapped around the high cost of cancer and how to insure against it.

Pre-existing condition exclusions cause treatment postponement. Many patients with pre-existing conditions preferentially seek insurance after the fact. Forcing coverage under such circumstances would drive up the cost of the premium, forcing even more individuals to forgo insurance.

The individual market screws patients by refusing coverage to persons with a cancer diagnosis. If the individual market were forced to cover individuals with a past history of cancer, all persons buying insurance in the individual market would be forced into higher premiums to pool that added risk.

Out of network doctors lead to medical debt: Many doctors choose to be out of network because they refuse to accept the insurers’ fee schedules, putting patients in the middle.

Annual benefit limits lead to debt: Benefit limits of $2500 to $20,000 to $100,000 are the exception and not the rule. $1 million is common, but when it is exceeded, what is the right limit that Americans are willing to pay for?

Patients need to continue working while getting chemo: In the example provided, the patient’s employer worked with the patient to maintain her employee status. Most do.

Separate deductables lead to debt: Deductables are a standard approach to making insurance affordable. What’s more, in the example provided, the patient was contesting a PET scan’s medical necessity, not the deductable.

COBRA sucks: COBRA was conceived, written and passed by the U.S. government and insurers are following the regulations. To the letter. Which is why the Feds have stepped in with another fix. Whether we can count on government over the long run to continue its support is a question mark because of the next item.

High Risk Pools suck: As the DMCB reads it, it’s the government that is underfunding them, which should make one wonder about the government's ability to manage any of this over the long run.