Knocked up, turned down

Insurance companies continue to deny coverage, and few realize an alternative health care plan exists

Aug 31, 2011 at 5:00 am

When Natalie Felker applied for health insurance this August with Anthem Blue Cross Blue Shield, the 35-year-old musician and waitress was promptly rejected due to a pre-existing condition.

That condition? Being pregnant.

Private insurance companies have long discriminated against those dreaded “Uterine-Americans,” routinely denying pregnant women. In addition, insurance companies have been known to deny coverage to women for having had a past C-section or for being the victim of domestic violence. Just as sick people cost insurance companies more to cover than healthy people, women are more expensive to insure than men. As a result, women typically are forced to pay much higher premiums.

In many ways, being a woman in America is in itself a pre-existing condition.

Though the Affordable Care Act (ACA) passed in 2010 makes such discrimination by an insurance company illegal, those changes do not fully take effect until 2014 — meaning Anthem was within the law to reject Felker.

As frustrating as the situation has been for Felker, a little-publicized and under-utilized program in the ACA — the Pre-Existing Condition Insurance Plan — will prevent her from going through her pregnancy without any health care coverage at all.

Felker’s situation is far from unique. After being laid off from her full-time job as a graphic designer in late 2008, she lost her health insurance, declining to pick up Cobra — a federal law that allows newly unemployed individuals to continue purchasing health insurance from their former employer — because it was far too expensive. After a year and a half of getting by without health insurance — the restaurant where she now works doesn’t cover her, and her husband’s insurance doesn’t either — she unexpectedly became pregnant this summer. She applied for Passport, Kentucky’s Medicaid program, but was denied because her household income was too high to qualify.

She then attempted to go back to the private market, but was given the bad news by Anthem.

“Careful consideration has been given to your request; however we regret that we are unable to approve your membership application. Our decision was based on Natalie Felker’s being an Expectant Parent,” Anthem’s letter stated.

“It’s not like I’m a deadbeat, I have a job,” Felker says. “Just because I’m not working for some big defense or health care company in this country that provides insurance doesn’t mean that I shouldn’t be protected in this situation.”

After Felker spent weeks wrangling with prospective insurers, a friend told her about the Pre-Existing Condition Insurance Plan (PCIP) in the Affordable Care Act. The PCIP was established to help people like Felker until such discriminatory actions are ultimately banned in 2014. The federally funded program serves a “high-risk” pool of applicants who are denied coverage elsewhere due to a pre-existing condition; it is administered by the states and gives patients full access to health care at below-market value.

Though her delay in discovering and applying for PCIP will likely mean she has to pay out of pocket at a hefty price for her first doctor’s visit, she should soon have full coverage under it to last throughout her pregnancy. Additionally, her coverage under PCIP will be much more affordable than a comparable plan in the bluegrass called Kentucky Access (another “high-risk” pool program created in 1996), with a monthly premium of $177 instead of between $500 and $800.

Just as Felker was initially unaware of PCIP and its relatively affordable rates, many people across the country who are desperately in need of insurance don’t know it exists.

The Kentucky Department of Insurance says that in November of last year, a few months after PCIP went into effect, only 23 people in Kentucky had signed up for it. Though U.S. Health and Human Services Secretary Kathleen Sebelius issued a press release early this year touting PCIP — and despite the fact that roughly half of non-elderly Kentuckians have pre-existing conditions and could be denied coverage or charged more due to them — only 140 Kentuckians had joined by the end of June. At the beginning of July, PCIP premiums were dramatically cut in many states — by 40 percent in Kentucky — in an effort to attract more people with pre-existing conditions. The next round of numbers will be released in late September.

The same trend exists nationally, as states and the federal government struggle to spread the word about PCIP. There are only 21,000 enrollees nationally, far below the 375,000 the Obama administration expected to enroll in 2010 alone. In fact, a Government Accountability Office study released Aug. 26 shows that of the $5 billion set aside to fund PCIP, only 2 percent has been used thus far.

So with insurance companies continuing to deny individual coverage, and a large amount of federal money untapped, the trick is getting people to realize PCIP is available, says Rhonda Sloan of the Kentucky Department of Insurance.

“When people call in they refer them to (PCIP). So I think the word now is kind of getting out. Agents are aware of it. Hopefully those numbers will start increasing soon,” Sloan says. “I think more outreach helps, plus the decrease in premium. Hopefully.”

Then again, perhaps both PCIP and its money won’t be around much longer. With Republicans railing against the Affordable Care Act — promising to repeal or de-fund it — an electoral sweep in 2012 might mean the end of what they derisively call “Obamacare,” before it even really begins … or before people even know what’s in it.