Affordable coverage for all Delawareans: Can it be done?
The News Journal, March 30, 2008
John Flaherty didn’t go to the emergency room, even though he knew he’d separated his shoulder.
Former press secretary for Sen. Joe Biden, he was riding his bike along U.S. 202 a few years ago when he hit the curb and fell to the ground. Medical bills for a similar injury in 1982 totaled more than $5,000.
“This time, I just kind of diagnosed myself and healed myself,” said Flaherty, 57, who quit his state job in 1995 to become an independent lobbyist. Strapped for cash, he rolled the dice and dropped his health insurance.
“It was a risk I took,” said Flaherty, who almost passed out after the wreck but rode home using one arm to steer. He wore a sling for two months and now is aware of “some creakiness” in the injured shoulder.
“I could have some disease and not know it,” said Flaherty, of Wilmington. “But I’m pretty optimistic. My father’s 90 years old. I think I’m pretty healthy.”
Toni Muncey and her family weren’t as willing to gamble.
With three children — the youngest an infant — the Hockessin mother returned to work full time this winter for one reason: health insurance.
“It was a constant fear,” said Toni, whose husband owns a small business and can’t afford health insurance — for himself or his employees. When Toni left her job at a bank last year to have the baby, the family had no coverage. For a full year, the two older girls, ages 10 and 13, weren’t allowed to go roller-skating with their classmates.
“Because if they fell and broke something, it would cost thousands of dollars in doctors’ bills,” said Toni, whose new job offers a solid family health plan that kicked in Jan. 1.
“When we were counting down” on New Year’s Eve, she said, “it was like, hooray! We have health coverage now!”
Roughly 106,000 people in Delaware are still waiting to celebrate. Uninsured, their access to health care is limited, making them less likely to visit a doctor when an illness surfaces and more likely to visit the emergency room later, when symptoms have worsened.
As Election Day 2008 nears, people are talking about a Delaware where everyone has access to affordable health care, where providers emphasize preventative care and management of chronic illnesses. A place where hospitals wouldn’t spend tens of millions in a single year on charity care, passing along some of those costs to insured patients.
A place where premiums for employer-sponsored health insurance wouldn’t rise twice as much as workers’ wages. The average premium for family coverage in 2007 was $12,106, with workers contributing about $3,281 each from their paychecks.
A place where 50-year-old Edward Long wouldn’t have to sit at home with a failing liver, waiting, without health insurance, to die.
“I have worked and paid taxes all of my adult life with the belief that my government would be there for me if and when I needed help,” said Long, who worked as a mechanic for NuCar Connections in New Castle for almost 30 years before he had to quit in 2005.
Diagnosed with end-stage liver disease, he went through scores of medical tests at Einstein Health Care Network in Philadelphia while on a Cobra health plan, then Medicaid, to prepare for a lifesaving liver transplant. Then he learned his Social Security disability — barely more than $800 a month — disqualified him from receiving Medicaid.
Delaware has no high-risk insurance pool for patients as ill as Long, and no private company would insure him.
“Right now, I feel like someone has a gun to my head and I am just waiting for the trigger to be pulled,” Long wrote in a Feb. 23 e-mail to Delaware Insurance Commissioner Matt Denn. For months, Long has written and called state and federal officials, pleading for help.
So far, no one has offered a solution.
A hot topic in elections
Changes appear to be on the horizon. Presidential candidates from both parties are talking about reforming the system, with Democrats Hillary Rodham Clinton and Barack Obama proposing different forms of universal health care, and Republican John McCain backing market-driven reforms that emphasize competition and personal responsibility.
In a recent Commonwealth Fund survey, most participants said health care reform will be “very important” or “somewhat important” when they head to the polls this fall.
At the state level, too, momentum is gathering. Gubernatorial candidates have unveiled plans for reform, and earlier this month, about 50 people rallied outside Legislative Hall in Dover, urging lawmakers to do something about the growing numbers of uninsured people and the rising costs of health care.
“It’s kind of hard to go through the day and not hear some complaint about insurance,” said Dr. David Hack, director of Tiny Steps, a St. Francis Hospital program that provides care to uninsured mothers. “Big bills. That’s usually what they come in grumbling about. … We just have to revamp the system. It’s a bigger issue than just putting a patch on it, which is what they’ve been doing for years.”
While Washington grapples with the big picture, small states like Delaware have an opportunity to tread new ground, said economist Lynn Etheredge of the Health Insurance Reform Project at George Washington University. He is considered a moderate in health policy circles.
“When all the legislators know everyone else they’re working with, when they’ve worked together for years, it’s somewhat easier for them to communicate and work through their differences,” Etheredge said. “A lot of the leading reformer states tend to be the smaller states.”
But so far, the First State hasn’t done any trailblazing. Health care bills proposed in the Delaware Legislature have been stalled by some of the same arguments that have paralyzed national reform efforts for decades.
Senate Bill 6, for example, easily passed the Democratic-controlled Senate but was bogged down in the Republican-controlled House. That bill would create a statewide health insurance pool aimed at making health insurance more affordable by requiring private insurers to offer lower-cost coverage to workers at small companies and to individuals who make $50,000 or less. Supporters estimate the plan would cost between $12 million and $13 million a year and cover as many as 36,000 Delawareans who are either uninsured or struggling to pay for coverage.
Lobbying for fairer rates
Delays are a matter of life and death to someone like Long, who, because of his progressing liver disease, can barely climb the stairs to his second-floor apartment. Denn, Delaware’s insurance commissioner, tried to explain the stalemate to him in a Feb. 19 e-mail.
“I also am frustrated with the state’s not acting on the bills I have proposed,” wrote Denn, who supports Senate Bill 37, which would allow the commissioner’s office to turn down excessive health insurance rates. Delaware is one of only 10 states in the country that does not regulate health insurance rates for either families or small businesses.
“I probably spend 20 [percent] to 25 percent of my time traveling around the state trying to get groups to help me lobby the Legislature to enact and fund these bills,” Denn wrote.
A more powerful lobby opposes him, however — the health insurance industry. Blue Cross Blue Shield of Delaware, the state’s largest insurer, has published a White Paper that lists several criticisms of Senate Bill 6. Pool participants, the paper claims, would be exempt from the rating and underwriting rules established under state law for the small-employer market. By doing so, a disproportionate number of people with costly health care needs would enroll in the pool, leading to a rapid rise in the money spent on each person insured through the pool. The company points to pools in other states that have collapsed because of weak support.
Blue Cross, which earned more than $457.7 million in 2007, also opposes the type of single-payer system proposed in Senate Bill 177, which would provide coverage through a nongovernment-run health care program for all current and future Delawareans.
“We do not believe it is in the best interest of the insured population to disrupt the system that is in place,” the insurance company said in a prepared statement.
About 87.5 percent of Delawareans have some type of health insurance, compared with 84.2 percent nationally.
Advocates of a single-payer system believe it would provide medical care for the scores of people who fall between the cracks because they don’t qualify for public assistance, such as Medicaid or Medicare, but cannot afford private insurance. By taking care of those people, the system would reduce the costs that hospitals incur providing charity care for those who cannot pay, and free doctors from mountains of insurance-related paperwork.
“A lot of hackles come up,” said George Turner, a member of the Delaware Alliance for Health Care Reform, which sponsored the March 13 “Affordable Health Care Coverage for All” rally in Dover. Several of the 50 or so participants carried signs supporting the single-payer bill. “There’s such a stigma about socialized medicine. The perception of the public is that it’s a lot of long lines and less quality coverage.”
As an alternative, many Delaware Republicans are backing a bill that would require health insurers to offer a “skinny” policy that would be free of all state mandates. The bill also would tinker with the insurance code to help lower the cost of premiums. Tax credits would be given to small-business owners, ranging from $1,000 to $1,500.
That bill also includes an insurance pool to make coverage available to those who currently cannot obtain it. Senate Bill 146, which Denn helped design, is aimed at covering up to 36,000 people at an annual cost of $13 million. The Joint Finance Committee set aside $1 million in the budget for the Democrat-backed bill in this fiscal year. The bill passed the Senate but died in the House.
A nationwide push
With horns locked in Legislative Hall, some of Delaware’s top business and nonprofit leaders have been looking beyond the state line for ideas about how to fix what’s wrong here.
Through the Delaware Public Policy Institute, several dozen stakeholders from across the political spectrum gathered for daylong sessions twice last year, studying reforms other states are trying.
As of February, a dozen states were moving toward comprehensive reform and three had enacted it — Maine, Massachusetts and Vermont, according to the Kaiser Commission on Medicaid and the Uninsured.
Both the Vermont and Massachusetts plans involve a mandate — meaning residents are required to obtain health care coverage, either through their employers or a newly established state-run program. Lower-income individuals receive a subsidy. The cornerstone of the Massachusetts plan, launched last year, is a “connector” mechanism to promote consumer choice. Individuals can shop for and buy coverage from competing health insurers. More than 300,000 previously uninsured individuals had obtained health insurance as of February 2008.
In Delaware, some are leery of mandatory health coverage.
“I didn’t believe they could make you do something like that,” said John Filasky, a Middletown farmer, who dropped his health insurance almost 15 years ago because he couldn’t afford it. He and his wife, Cindi, pay out of pocket for regular visits to the doctor and dentist, hoping to avoid a health catastrophe.
Connecticut’s proposed plan would provide affordable health care coverage to uninsured adults, ages 19 to 64, of all incomes, who do not have health insurance through an employer. The plan would offer a state-defined benefit package and premium subsidies based on a sliding scale. Approved by the Legislature, that program is slated to start in July.
So far, reform for most states has been costly.
In Massachusetts, officials say the costs to the state will be higher than the $869 million proposed just two months ago. Pennsylvania’s proposed plan to cover 270,000 people — about one-fifth of its uninsured population — by 2012-13 has a price tag of $1.1 billion. The state expects to pay for it through a combination of monthly premiums, federal Medicaid dollars, tobacco settlement money and money from its medical malpractice insurance fund.
California’s Senate in January rejected a $14.9 billion proposal to cover almost all of its 6.6 million uninsured, saying the state’s already in the red.
“Covering more people requires more revenue,” George Washington University’s Etheredge said. “It is more difficult, but there’s also going to be more need and more people losing health care coverage.”
The Delaware Public Policy group wasn’t ready to commit to comprehensive reform. In its “Small State, Big Opportunity: Taking Action for the Uninsured” report released earlier this month, the group proposes incremental reforms, with a focus on raising awareness about existing programs.
Last year, Delaware had to return about $3 million of the $10 million it received in federal aid because there weren’t enough young people signed up for the State Children’s Health Insurance Program. The program covers millions of children up to age 19 who can’t get coverage through their parents’ job-based insurance and whose families make too much to qualify for Medicaid.
In the months ahead, the DPPI group, supported by a $500,000 grant from pharmaceutical giant AstraZeneca, will try to connect Delaware’s uninsured with an expansive — but disconnected — safety net that already exists.
More than 500 doctors have been recruited over the last 15 years, for example, to offer pro bono care for the uninsured through the Volunteer Initiative Program, administered by the Medical Society of Delaware.
“Nobody wants half their practice to be uninsured patients because you’d never be able to make a living,” said Dr. James Gill, director of Delaware Valley Health Outcomes Research, which investigates health care policy.
He has studied the state’s Community Healthcare Access Program, also known as CHAP, and found that it improves health by providing the uninsured access to doctors, medical specialists and other health resources. The program is funded with Delaware Tobacco Settlement Funds through the Delaware Health Care Commission.
“This program allows for distribution of the uninsured among the physicians,” said Gill, who believes that CHAP and the Volunteer Initiative Program (VIP) can grow, but aren’t sustainable solutions to the health care crisis.
Federally qualified health centers such as Henrietta Johnson Medical Center in Wilmington and La Red Health Center in Georgetown offer care for free or at reduced costs to the uninsured or underinsured. But hospitals bear the brunt of the burden.
Steps toward caring for uninsured
The increasing costs of charity care and bad debt has created “almost a crisis for hospitals,” said Julie Topkis-Scanlan, senior vice president of external affairs and marketing at St. Francis, a Catholic hospital in Wilmington that operates several programs for the uninsured or underinsured. The hospital provided about $4 million in charity care in 2007, and wrote off another $16 million in bad debt, or unpaid bills.
“I think we’re making a dent because it saves in emergency care costs,” said Topkis-Scanlan, who helps raise funds for Tiny Steps and the St. Clare Medical Outreach Program, which sends a van into Wilmington neighborhoods several days a week. Physicians at Tiny Steps treated about 600 mothers last year, and more than 4,000 people received treatment at the van.
“It keeps them from getting critical,” Topkis-Scanlan said. “In a more perfect world, I think maybe we would have a special off-site clinic that would predominantly take these patients 24-7.”
Christiana Care redirects thousands of uninsured patients from emergency rooms at Christiana Hospital and Wilmington Hospital to the Wilmington Hospital Health Center, where patients pay on a sliding scale based on their income. Someone who is uninsured and is getting a tooth pulled, for example, may be charged only about $40 at the center’s Department of Oral and Maxillofacial Surgery and Hospital Dentistry. It could cost about $200 to 300 at a private practice. Root-canal treatment at the hospital ranges from $130 to $235 compared with private practice fees in the range of $950-$1,150.
Almost 100 volunteer dentists come from the community to work in the dental department.
“Some dentists come in after their practice closes,” said Dr. Edwin Granite, the department chair. “They’ll end their workday at 6 and come here and work until 10 p.m.”
Each year, the center handles about 67,500 patient visits. Wilmington resident Joanne Caputo called her dental care at Wilmington Hospital Health Center “a gift from God.”
For two years, she lived with intense pain in her jaw, but because she was underinsured, she couldn’t afford a root canal, which can cost up to $2,000 out-of-pocket.
“Through a series of financial catastrophes, dental insurance was the last thing on my list,” said Caputo, who recently turned 65 and now is covered by Medicare. “They did really comprehensive work to make sure my whole mouth was healthy.”
For thousands of others, though, help hasn’t been as forthcoming.
Mike Mansfield had to file for bankruptcy because of his rising debt, primarily because of his medical bills.
“If I had insurance through a business, I could’ve kept paying something,” said Mansfield, 36, of New Castle, who was paying about $500 a month on medical bills from his earnings as a car mechanic.
When he was in his 20s, Mansfield was injured several times, once in a motorcycle accident that severed his pinkie. Later, an injury from another car accident — not his fault — forced him to go on disability for five years. By the time he filed for bankruptcy in June 2005, he owed $52,000 — more than half from medical bills. He’s now living with his mother.
“A lot of us are one accident away from losing everything,” said Mansfield’s lawyer, Cynthia Carroll, who has seen a growing number of clients file bankruptcy because of medical bills.
Long, the 50-year-old with liver disease, filed bankruptcy last year after going through most of his 401(k) savings to pay medical and living expenses. Until a couple of weeks ago, he spent hours every day on the computer, researching possibilities for funding a transplant.
He lost hope March 12, after receiving another discouraging e-mail from a public official.
“I’ve given up the fight,” said Long, whose belly is the size of a basketball because his liver won’t pump out fluids.
Health care reforms might be on the way, but Long doesn’t expect to live to see them.
