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Thursday, Mar 28, 2024

Caring for Underinsured Taxes Providers

Guadalupe Ibarra is one of the estimated 500,000 San Fernando Valley residents who don’t have enough health insurance. For six years, the single mom living in North Hills has had only the barest of Medi-Cal coverage to pay for emergencies and care for her three children. Because she’s not working, Ibarra sees the state-supported health system as her only option even it means she doesn’t have insurance for herself. She worries about what might happen to her. “If you get sick or something and don’t have insurance, it’s really hard,” she said. “It’s difficult.” Ibarra’s situation is far from unique in California, where 7 million people 19 percent of the total population are uninsured, according to the U.S. Census Bureau. It’s a daunting reality that hospitals are forced to grapple with on a daily basis. “Volumes continue to rise,” said Kerry Carmody, administrator for Providence Holy Cross Medical Center in Mission Hills, where 12 percent of patients are uninsured. “It’s really impacted all of our emergency rooms.” Because hospitals can’t turn people away, most have two options when it comes to who pays for procedures on uninsured patients: either pass the bill onto the patient or pay for it themselves. For hospitals already hampered by tough state regulations, liability costs and competition from outpatient surgery centers, the bills can go into the millions of dollars a year a situation multiplied because uninsured people will often wait to go to the hospital until absolutely necessary, when injuries or sicknesses are more likely to be severe, Carmody said. “They turn to the emergency rooms in the San Fernando Valley as their primary care providers,” he said. To address the surging numbers, hospitals like Holy Cross are forced to expand emergency room operations and hire more staff. “Those are all costs that are absorbed,” Carmody said. “The cost for those salaries continues to go up.” A big problem While Valley hospitals see thousands of uninsured a year, a large number is treated through community clinics, such as the 10 managed by Northeast Valley Health Corp. The clinic treated almost 165,000 patients last year, 38 percent of whom were uninsured the vast majority are working adults employed by companies that did not have comprehensive coverage, said Vilma Champion, director of managed care and marketing for the NEVHC. “A lot of the population we serve work in small businesses, which usually doesn’t offer insurance,” she said. Indeed, a major factor in whether a person has health insurance is the size of his or her employer, said Mark Morgan, marketing and product development officer for insurance provider HealthNet of California. Morgan said that just 40 percent of businesses with fewer than 12 workers offer insurance to workers. “So it’s a scale question,” he said. “That’s a function of the operating margins of a small employer.” The problem comes when workers assume they can’t find affordable insurance. “It’s still very costly for them,” Champion said. “The (public) programs that are available are mostly for children.” There’s a big problem with that kind of thinking, however: It’s not true, according to insurance brokers. Leonor McCall-Rodriguez, vice president of emerging markets for Thousand Oaks-based Blue Cross of California, pointed to dozens of low-cost and free insurance programs from numerous providers that many overlook. “We know that for a third of the uninsured, they could be insured today if they just knew about,” she said. “There’s a lack of information out there.” In her experience, McCall-Rodriguez said a surprising number of uninsured people would be willing to pay for coverage but are disheartened by the minutiae. “This is a very dry, difficult subject,” said McCall-Rodriguez, who works in the company’s Newbury Park location. “Most people have experience with insurance. But when it comes to buying it on your own, most people don’t know how to go about it.” Morgan said people get discouraged. “That lack of awareness leads people to believe there aren’t solutions and that leads people to become uninsured,” he said. There are other long-held misconceptions. “We oftentimes run into the perception that managed care companies are taking advantage of these people,” Morgan said. “The trust isn’t there. If they just knew the facts.” Some of that is the result of cultural misunderstandings. Southern California’s large population from Latin America, for example, came from countries where insurance was either unavailable or government-supported. Many have never had to deal with premiums, HMOs or PPOs, McCall-Rodriguez said. “When you take insurance, which is difficult to understand in English,” it’s even more challenging in a different tongue, she said. “With the Latino populace, there’s a socioeconomic issue,” Morgan said. “It adds to the complexity.” Education the solution? To address the misconceptions, many providers including Blue Cross and HealthNet have started education divisions to provide information to brokers, doctors, nonprofits and uninsured people about the industry. Along with insurers such as Kaiser Permanente, PacifiCare and Aetna, they have also established low-cost programs, some of which offer coverage for less than $40 a month. But the most aggressive tact so far has been by Blue Cross of California, which last year introduced Tonik, a low-payment insurance system for young people. More than 78,000 signed up in 2005 alone, according to the company. Still, the costs are often out of the grasp of many. A study released this fall by the Commonwealth Fund found that 89 percent of adults who looked into buying insurance since 2003 were turned away for health reasons or found it out of their budget. There’s also Medi-Cal, the system offered by the California Department of Health Services that Ibarra and her three children use. Programs are offered to a wide number of people, from moderate-, low- or no-income adults and families to immigrants awaiting legal status to those denied for private health insurance because of an existing medical condition. Still, some see those programs as handouts, said Chad Westover, vice president of state-sponsored business for WellPoint Inc., the Thousand Oaks parent of Blue Cross. In fact, about 3 million of California’s uninsured qualify for government assistance programs but don’t apply, according to the Foundation for Health Coverage Education. “Some of these individuals who have moderate income really exclude themselves,” Westover said. It seems the concept of low-cost insurance is still below the radar of many uninsured people, he said. Despite the costs, though, hospital officials refuse to turn people away. Footing the bill, it seems, is the only solution, Carmody said. “I don’t think anyone has come up with the magic bullet yet,” he said.

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