SUN EDITORIAL:

Making health plans clearer

Consumers deserve more specifics about what their policies don’t cover

Sunday, July 5, 2009 | 2:05 a.m.

Much of the debate over the need to provide comprehensive health insurance to all Americans has focused on the high percentage of individuals who don’t have any coverage. What has sometimes been overlooked is that many people have insurance, but not enough to prevent deep financial distress should they require major surgery or other expensive care.

Last week The New York Times wrote about Lawrence and Claire Yurdin, whose policy indicated they had coverage of $150,000 a year for hospital care. Excluded from the coverage, though, was nearly all of the heart treatment the husband received at a Texas hospital.

Late last year, the story noted, they were forced to file for bankruptcy as their medical debt approached $200,000.

Harvard law professor Elizabeth Warren, who has analyzed medical bankruptcies, issued a sound warning when she told the Times: “Underinsurance is the great hidden risk of the American health care system. People do not realize they are one diagnosis away from financial collapse.”

With that in mind, Congress should require health insurance companies to do a more thorough job of explaining the financial limitations of their policies to consumers. That is particularly important in the case of limited-benefit plans, which is what the Yurdins had.

Many people unwittingly put their trust in insurance companies, assuming their policies will cover major health problems. Too often, though, consumers receive the shocking news that their policies have more gaps than they realized.

Insurers should be more forthcoming in written material about the amount of money a policyholder can expect to pay out of his own pocket should he need a specific surgery or other form of medical treatment. This would give consumers clearer information about what is not covered in a policy, which would enable them to do a better job of financial planning.

Ultimately, Congress should find a way to replace limited-benefit plans with more comprehensive policies that would better protect consumers from the prospect of slipping into medical bankruptcy.

Discussion: 6 comments so far…

By uddeboda

7/5/09 at 2:41 a.m.

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Insurers will never ever be forthcoming about putting in writing what is and what is not included in their policies. It will always be a jungle of small print, refer to sect 3, paragraph 62, subsection 19 etc etc, one needs to have a degree in several languages to understand some of their jargon.

INSURERS are interested in one thing, and that is to make as much money out the clients, AKA "suckers for punishment".

The Yurdin family are but one of 10s or 100s of thousands that are cheated ever year by health insurance companies, many into personal bankruptcy
By Patrick_R_Gibbons

7/5/09 at 7:42 a.m.

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udde,

they do have to put it in writing....and one more think, bankruptcy can be a good thing. That person is alive, well, and now they don't have to pay back the entire medical bill. Some people want to treat bankruptcy as worse than death, it is not.
By GordonShumway

7/5/09 at 9:06 a.m.

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Gibbons: I assume you're joking.
By msohnoohyes

7/5/09 at 2:57 p.m.

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We all know that #1 Insurance Companies are in business to MAKE A PROFIT just like the businesses we work for. Policies are now written much clearer however, the cost to mail them does increase and thus raise prices. Oh I know that sounds so minimal a reason but the more paper you receive, the more it costs. #2 Insurance agents are there for explaining your policy. Have them do so. Don't forget, Life, Health, Auto & Homeowners insurance are usually handled by different divisions. People are so cynical about health care. Better health care can be found. #3 Insurance is one of the few industries around that regulates itself. and #4 It seems American's have much more faith in their health insurance provider than they do in the other divisions, At least until the next storm!
By Bumpmiester

7/6/09 at 10:19 a.m.

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I completely agree. After all, nearly half of all bankruptcies are related to medical care, and this explains why such a large percentage of those involve the insured populace. The remedy is, of course, sterner regulation of the insurers, but then, the very idea of supporting the delivery of health services by private insurance creates an insurmountable conflict, between public health and profit motives. It's not as though the insurers can't make a profit by providing better and more understandable coverages, it's just that without regulation, we leave all of our needs exposed to the amorality of capitalism.