Bay Area Reporter -October 12, 2000
Dan Aiello

The company's members were notified last week that it has scrapped its entire line of plans. It will replace every individual plan effective January 1, 2001 with new, slightly more expensive policies that increase both deductibles and co-pay requirements.

For the healthy member the changes will amount only to a nominal cost. But for those who are sick, the changes amount to as much as $5,000 more per year.

In the October 1 letter to its members, James Ebbitt, Blue Cross senior vice president of individual services, stated that the dramatic reduction in coverage was actually "aimed at keeping Californians covered." However, it's the loss of coverage of some items, the increase in deductibles and co-pays, and the replacement policy's new restrictions on patient care and hospital stays that are explained in the materials accompanying Ebbitt's letter.

It was just a few months ago in June that Blue Cross increased its annual deductible (the amount a member must pay out before the insurance carrier will cover 100 percent of medical costs), from $500 per year for a PPO member to $3,000 per year and raised co-pays by 5 percent. The new policies will require between $4,000 and $5,000 be spent by the individual member, unless a patient is willing to switch from the company's PPO plans to its more restrictive HMO plan.

In addition to the increased deductibles, members must now pay "25 percent of charges of negotiated fees" for doctor's visits, according to Ebbitt. Members used to pay between $5 and $20 per visit as a flat fee, regardless of the physician's charges. This change could force many sick patients to avoid costly specialists; a deterrent that would benefit Blue Cross but not a patient's well-being.

The same is true for tests. Blue Cross now demands between 25 and 50 percent of all tests be paid by members. Many HIV patients may no longer be able to afford costs for monthly viral load or CD4 tests and may avoid them, and regular physician visits altogether.

Emergency services, such as urgent care, will become prohibitively expensive for Blue Cross members with these changes as well. In this case, members will be forced to pay between 25 and 50 percent of charges. Visits to non-participating urgent care providers, such as those out-of-state, will not be covered at all. This is a clear deterrent for Blue Cross members to stop using urgent care services and also a serious loss of coverage for members who travel out of state.

Hospital visits also will now be charged to members on a percentage basis, up to $650 per day. For the chronic and terminally ill, like HIV patients, the annual deductible of $4,000-$5,000 will likely be reached. Therefore, in many ways the company's increase in the last six months of the amount a member must pay from $500 to as much as $5,000 becomes a very real increase in medical expenses for many HIV-positive individuals who are still working but cannot qualify for government assistance, a group of people benefits counselor John Keasler describes as "working-class poor people."

For HIV-positive members, many of whom live on limited or fixed incomes, the changes mean painful increases in medical expenses. Expenses that already are difficult to manage in a city as expensive to live in as San Francisco.

Industry wide, healthcare insurance providers are making policy changes which force chronically ill patients into restrictive HMO plans that the provider can then case manage in order to deny benefits, such as costly tests.

HMOs are considered to be one of the worst plans for someone who is HIV-positive largely because physicians who specialize in HIV care won't accept the low reimbursement offered by an HMO provider, an amount that can be as low as $8 per month. The reimbursement is based on a healthy population and most patients in that medical model are not regularly seen. In the case of an HIV practice, nearly every patient is seen at least once a month, making the HMO's reimbursement ridiculously low. In addition to the inadequate reimbursement to HIV practices, many HIV physicians complain that HMOs don't allow them to treat the patient effectively, refusing tests and treatments the physician feels are necessary.

One exception to this is the Kaiser model, which is able to offset the costs of treating the chronically ill because its physicians are the company's employees and many tests are conducted by Kaiser. However, patients with chronic or terminal illnesses are essentially locked into their plans because insurance carriers are allowed to deny membership to any Californian they deem to be potentially unprofitable. Therefore, even if an HIV-positive Blue Cross member wanted to change to another insurance provider, he or she could not.

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Always watch for outdated information. This article first appeared in 2000. This material is designed to support, not replace, the relationship that exists between you and your doctor.

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