HEALTH CARE/Joan Retsinas

Crystal Ball to Cost-Cutting in Pennsylvania

The government insures a slew of people. Medicare, Medicaid, the Department of Defense work-force, active-duty military, veterans, prisoners, and employees – all get their insurance courtesy of taxpayers. What happens when the government drops you? Where do you go?

To date, most Americans haven’t faced that scenario.

Once Uncle Sam gathers you under his Medicare tent, you are secure, no matter how expensive you prove. If you are covered under a state Medicaid program, the new rules for national health reform prevent states from dramatically slashing their rolls.

Like Uncle Sam, states are stuck with their enrollees, unless of course those enrollees grow too prosperous for Medicaid eligibility (unlikely in this recessionary time). If the government insures you because you are in the military, in jail, or in their workforce, the government will not reneg, so long as you stay where you are.

This, though, is the year when candidates vow to cut spending. Our would-be leaders want to make Uncle Sam, and his state minions, frugal. That may mean slashing the rolls. What will happen? Conservatives – always optimistic – predict that people will do fine: they will find insurance on the private market, they will find jobs that give insurance, they will seek out free clinics, they will find some non-governmental solution that will give them health care.

Until recently, Pennsylvania insured low-income adults who were not eligible for Medicaid. It didn’t insure a lot of them: adultBasic served 41,000 Pennsylvanians. They are an easy target for elimination, since they don’t constitute a critical mass for effective protest.

Another 500,000 Pennsylvanians were on the waiting list. Most states do not insure this group, which draws no matching federal funds. Pennsylvania used some tobacco settlement revenues, plus contributions from the state’s four Blue Cross and Blue Shield companies. The cost came to $166 million in 2010.

Enrollees paid $36 a month. The state of Pennsylvania was heavily subsidizing this insurance. Heavy subsidies don’t jibe with budgetary red ink. And they don’t jibe with conservative mandates to cut spending. So Pennsylvania’s Gov. Tom Corbett (R) opted to slash the program, save the money. $166 million won’t fill a mammoth budgetary hole, but it does demonstrate frugality. The program ended Feb. 28. Pennsylvania sent letters to enrollees.

I assume the state wished them luck as they searched out another insurer.

From the Kaiser Health News, Jenny Gold (Sept. 26) traced the consequences of this cost-cutting move.

A sliver – 1525 – of the enrollees qualified for Medicaid. For the rest, the state’s high risk pool was an option, but an expensive one. Since high-risk pools, by definition, cover people who need expensive care, the premiums, even if subsidized, are costly. In Pennsylvania the premium comes to $283. After six months without insurance, many enrollees were eligible for this pool. But few earned enough to pay the tab. A cheaper option was Blue Cross’s Special Care program: $192 a month. Yet the plan pays for only four physician visits a year and doesn’t cover prescription drugs. For enrollees with chronic conditions, or who develop acute illnesses, that won’t suffice. Nevertheless, 15,700 adultBasic enrollees signed on for this still expensive, yet limited coverage.

Indeed, the reporter told of one married couple, both cancer survivors, who earn $25,000 a year, yet pay $300 a month for Special Care.

They had sought out the more comprehensive private-sector plans. Some plans rejected them; one offered them a policy for $1,000 a month.

The rest of the adultBasic population – roughly 23,000 people — go to emergency rooms; one ER claims its visits increased by 30%. The people still go to hospitals, adding to hospitals’ unfunded care. They go to community clinics, though the state has not expanded those clinics. And they do without.

Back to the future we go. In a conservative Eden, when Uncle Sam retreats from health insurance, we will have similar stories of budgetary triumphs.

Joan Retsinas is a sociologist who writes about health care in Providence, R.I. Email retsinas@verizon.net.

From The Progressive Populist, November 15, 2011