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Health Insurance Bankrupts Americans

Without a public plan we will continue to lack a way to force improvements in private plans.
 
 
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Most Americans fear private health insurance companies won't be there for them when they get sick. As the debate heats up, it's really clear that a strong public health insurance plan must be a no-compromise element of any health care reform package. According to the Harris Poll only 7% of people judge private health insurance companies to be "honest and trustworthy." Trust in private health plans ranks above tobacco (2%) and oil companies (4%) but below hospitals (31%) and banks (21%).

People have a lot of reason to be suspicious about whether private insurance will cover them when they fall ill. A report from the American Cancer Society and Kaiser Family Foundation showed that despite having private health insurance, cancer patients are running up large debts, filing for personal bankruptcy, and even delaying or forgoing treatment because they can't afford care.

This is one of the reasons why a Lake Research poll found that a whopping 73% of voters want everyone to have a choice of a public health insurance plan while only 15% want everyone to have private insurance.

An accessible public plan is critically needed for Americans who want an option they can be confident will be there when they need it. Consider the story of Kathleen:

Kathleen, 46, is uninsured and has been denied coverage in the individual market because she has symptoms of leukemia. She lives in Florida, where the high-risk pool is not accepting new beneficiaries. She remains uninsured and has not had the necessary tests to confirm her diagnosis. "I have lost all faith in physicians and the health care system," Kathleen says. "No one is doing anything to help me."

A group in Washington State has recently filed a law suit against high promising but non-delivering insurance companies. "It's a significant problem. People think they are covered and turns out they aren't," said Joshua Welter, of Washington Community Action Network, a grass-roots organization supporting issues such as health-care reform. One of the people who was a victim is Ruth:

Ruth Bjorklund had an emergency hospitalization and later brain surgery. When she was hospitalized, Mrs. Bjorklund thought she had health insurance that met all the requirements under state law. But when the bills started coming in, she realized Nationwide was paying only a minimal amount of her expenses. Now she's more than $135,000 in debt. "I have a master's degree, and I got duped," said Bjorklund. "A lot of people were sold this plan. Hundreds of them. And it's wrong."

A Harvard study found that 50 percent of all bankruptcy filings were partly the result of medical expenses. Every 30 seconds in the United States someone files for bankruptcy in the aftermath of a serious health problem. Consider the plight of David:

David had to stop working as a truck driver after he was diagnosed with kidney cancer and has since been struggling to pay for COBRA during the two-year Medicare waiting period. His wife, Gloria, is his full-time caregiver and cannot work outside the home, and the couple has had to use much of their savings and borrow from friends and family to pay for their COBRA premiums. David cashed in his 401K at a 24 percent loss so that they will be able to continue to pay the COBRA premium until he is eligible for Medicare. Gloria tried to apply for Medicaid, but she learned that their income is too high. "There is not any help for people like us. We are not considered poor enough, but we don't have the money to pay it on our own," Gloria says.

The case for a public option is simple. People need insurance they can trust. They need insurance they can afford and public insurance has a better track record than private insurance when it comes to reigning in costs while preserving access. Without a public plan we will continue to lack a benchmark which to force improvements in private plans. Americans want public and private insurance competing side by side so that they can choose the best option for themselves and their families.

 
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