Low-cost health insurance debated


A proposal by Blue Cross and Blue Shield of Maryland to offer low-cost health insurance to some of the 570,000 Marylanders who do not have coverage has come under fire from a consumer group.

Maryland Citizen Action Coalition said the plan would undermine the state's system of required health-insurance benefits and be too expensive for many uninsured people.

But Blue Cross said the plan will not present any competition to existing plans that fall under state requirements and that it is targeted to only a segment of the uninsured population.

Tom Higgins, vice president for public policy for Blue Cross, said a state study showed that about a third of the people without insurance have annual salaries of more than $30,000. "It would be affordable to a significant portion," he said.

The attack comes about two weeks after Blue Cross presented its plan to the Governor's Commission on Health Care Policy and Financing, which is studying Maryland's health-care system and the issue of uninsured people. A report to the governor is to be made sometime in the future.

Only individuals who have been without insurance for 12 months would be eligible for the coverage, which would cost between $65 and $150 a month for an individual.

The plan would offer fewer benefits than existing plans. Subscribers would also have to pay a $200 deductible and then 20 percent of all costs. These out-of-pocket expenses would be capped at $2,000 per year.

The plan would cover only 10 days of inpatient hospital services with a maximum of $50,000 in health-care costs.

However, it would cover the full costs of various preventive-care benefits, such as periodic physical exams, immunization, cholesterol screenings, mammograms and pap smears. This portion of the program was applauded by the coalition.

The most controversial provision is the waiving of benefits that state law requires in health-insurance policies. These so-called mandated benefits include procedures such as transplants, in vitro fertilization, mental-health care and substance-abuse treatment. In total, there are 32 mandated benefits, one of the largest numbers required by state law in the country.

However, these mandated benefits are not required for health-maintenance organizations or businesses that are self-insured.

The elimination of mandates for the program was criticized in a letter from Janelle Cousino, executive director of the coalition, to Eugene Feinblatt, chairman of the commission.

By waiving the mandates, Cousino said, there would be a defacto lowering of the minimum benefits required in Maryland. "There is a strong likelihood that small employers currently providing health-insurance benefits will demand the same relief from mandated benefits requirements, in pursuit of lower priced policies," her letter said.

"This is not the nose of the camel," Higgins replied.

He said the proposed program would not be a threat to mandated benefits because it is not in competition with existing plans. That is because provisions, such as the 12-month period of being uninsured, would restrict the coverage to its intended target.

Cousino also said the Blue Cross plan would "leave huge gaps in the health-care safety net" because of the expenses would still be high and coverage would be limited.

"The annual out-of-pocket expense limit of $2,000 is still more than many of the newly insured will be able to afford,"

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