Not as Simple as We Think

By Kristin Morin, MSN RN

I wish lowering healthcare costs was as easy as “cost awareness”, but as one patient put it, “I never pay the first few bills, because the amount changes every time a new bill is sent.”  The payment system is so fragmented that it’s hard to know what will become an expense with any given illness.  Even the savviest of consumers of healthcare have difficulty with hospital payment systems.  Most consumers of healthcare are not savvy consumers.  Comparing the cost of apples and oranges in one grocery store to another is not like comparing a hip replacement from one hospital to another.  Often in emergency situations the cost is not even on the radar.

The Healthcare reform debate is loud and clear that more people will be covered with the state and federal healthcare exchanges and the expansion of Medicaid.  That’s if all states decide to expand their Medicaid system.  What has been difficult to discern is what is covered with insurance and what becomes an out-of-pocket expense.  Cost sharing in the form of premiums, co-pays, deductibles and co-insurances has been the answer for many years for the moral hazard of over usage of insurance dollars for unnecessary care.  I would like to illustrate one employee’s experience by fast forwarding to current day and the effects of years of fine tuning cost sharing.

As an occupational health nurse, I have seen the financial ruinous results of health insurance coverage for working people.  The organization I work for is a typical large manufacturing corporation.  The insurance that this organization provides has been benchmarked by an outside consulting firm to assure that the company is not providing any more or less than any other corporation close to its size and value.

To review what is covered in the plan, there is a fifteen dollar co-pay for every primary care visit and a thirty dollar co-pay for specialist visits. The premiums are $500.00 a month for a family plan.  This employee is a machine operator making approximately $18.00 per-hour.  He needed cardiac bypass surgery and he was in luck. His doctor and the hospital were within network.  His deductible was only $2000.00. The out of network co-insurance expense is $4000.00  Unfortunately, he had complications and the incisions for vein harvesting in his legs had infected and he was readmitted into the hospital extending his disability out of work time.  He reached the $2000.00 deductible easily.

This employee prides himself as been a committed long term employee of thirteen years and expressed gratitude for the benefits he has.  This is where my heart sank.  He was grateful for his sinking ship.  He couldn’t pay his mortgage this month and many other bills are receiving the proverbial $10 good faith check regardless of the amount owed.  He expressed that life as he knew it had changed beyond belief.   His debtors call daily.  He added up all his expenses with my urging in hopes to use his story.  Not for his own benefit, but to hopefully have his story reach the decision makers. Between all the different co-pays for all the specialists and rehab, the deductable, and medications his tally thus far is over $7000.00 and still counting.

This is a man feeding a family on $18.00 per-hour.  Here is the biggest insult added to injury.  When an employee is hired, they are told that the employer will pay in full their short term disability premiums.  It sounds wonderful.  When you need it, that’s when you find out it’s only 60% of your pay for the hourly people.  The salaried employees receive 100% of their pay.

My last note on this story is that this husband and father who has worked his whole life feels hopeless and unable to provide for his family.  This is an understatement and I believe the depth of that feeling for him is similar to the depth of a black hole.  He said he would gladly pay an increase in the premium for short term disability if it would pay his wages at 100%.  He is grateful that he has benefits and that he will be able to return to his job.  I have had countless conversations with employees in this very same sinking boat.  I believe that despite ACA’s attempt to provide insurance for more citizens of our country, it has not really addressed the inability of people to survive if they should actually need health insurance services.

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Kristin Morin, MSN RN is a recent graduate of Yale University, Nurse Management, Policy, and Leadership Program.  She is currently Program Director, Behavior Health Network.  Kristeen was also a contestant in the 2012 Costs of Care Essay Contest.