Health Plan :: Insurance mandate with no cost controls is undue burden on patients

Health plans approved under Massachusetts’ health insurance mandate would be unaffordable for many citizens due to high out of pocket costs and no regulation of future rate increases, said the nonprofit nonpartisan Foundation for Taxpayer and Consumer Rights (FTCR).

The cheapest plan providing minimum coverage could cost a 56-year-old, living in Boston and making $30,000 a year, a third of his income in health expenses.

“These plans are proof that when private insurers can charge whatever they choose, and consumers must buy what they’re selling, patients get the short end of the stick. It’s a bonanza for insurers and a financial catastrophe for the consumer. Patients and families cannot afford to spend 30% of their income on health care. Even worse, nothing prevents these prices from going up in the future,” said Carmen Balber, consumer advocate with FTCR.

A heavy reliance on co-insurance in some plans (meaning a patient could pay 35% of a hospital bill rather than a co-pay for a fixed amount) leaves consumers unable to estimate the real cost of coverage.

The state will be forced to exempt many citizens from the health insurance mandate because these plans remain unaffordable, said FTCR, defeating the promise of universal care under the law.

On top of premiums, which range from $173 a month for the cheapest “basic” coverage plan to $837 a month for the most expensive “premium” plan, patients are subject to additional costs in all of the basic coverage plans. These include:

– Out of pocket maximums up to $5,000 per individual and $10,000 per family, that do not include premiums, some co-pays or some deductibles.
– Co-pays ranging from $10 a doctor visit to $750 for a hospital admission, in addition to the plan deductible. Plans do not specifically include co-pays in the out of pocket maximum.
– Separate deductibles for drug costs up to $500, after which patients will still pay for drugs in a range between $10 to $100 a month, all the way up to 50% of the cost of every brand name drug.

These additional costs would make the basic coverage plans unaffordable for many patients.

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