While company advertising tries to lure individuals, those individuals find it rough going to get insurance

Vicki LoSasso spent several years as a Nevada state employee and benefited from the state health plan. Then she broke off on her own to work as a freelance artist. She encountered a problem she had not anticipated.

“But a year ago, when I had to go to the market as an individual seeking health insurance for the first time, I became uninsurable to one company and only partially insurable to two others,” she said. “In Nevada, I was told by my agent, these three insurers are the only options available to someone seeking an individual health plan.”

Television commercials running in Nevada make it look awfully easy—the company will welcome individuals with open arms.

“The conditions that made me uninsurable are a uterine fibroid tumor, a common problem in women that usually requires no treatment and is probably in the process of dissolving because that’s what usually happens to women my age; glaucoma which was caught early and has been controlled on eye drops for years resulting in minimal actual damage to my eyes; and human pappiloma virus, which is a potential precursor to cervical cancer. In all other ways, I am the picture of good health.”

LoSasso’s agent submitted Jane Doe applications describing LoSasso’s status to three insurers. Blue Cross Blue Shield said she was uninsurable. Humana offered a policy at twice the normal premium and with possible waivers. Assurant actually provided her with a policy, but she pays $3,000 a year with a $5,000 deductible and an $8,000 deductible for any sight-related problems, plus a waiver for cervical cancer.

“I live with the knowledge that if I develop cervical cancer, I will probably face bankruptcy,” she said. “I also worry that if I develop some other condition, my premiums might increase drastically, or I might even lose coverage entirely and have no recourse.”

Motivation
The whole experience prompted her to join a local effort to change Nevada’s laws, which favor insurance companies. She spoke last week at an event where the results of a national health insurance survey were released.

The state-by-state report was compiled by Families USA, a lobby group based in the District of Columbia. It graded states in 14 areas of consumer protection.

The report gave Nevada “full credit” in four areas—using objective standards to define pre-existing health conditions, advanced review of proposed premium rates, making the decisions of independent reviews binding, and granting appeals when coverage is revoked.

Nevada received “partial credit” in two areas. One is requiring insurers to use at least 75 percent of premiums on health care. Nevada does this only with some insurers. The second is allowing consumers to inspect records of denials of coverage. This is available in Nevada only for some types of coverage.

It is all downhill from there. Nevada does not:

• require insurers to sell coverage to all applicants (five states do);

• require affordable alternative coverage for uninsurables (seven states do, and 10 offer partial programs);

• prohibit higher premiums based on health status (seven states do);

• limit how long coverage can exclude pre-existing conditions (29 states have limits from six months to a year);

• limit how much earlier health history can be used (25 states have limits from six months to a year);

• require medical underwriting to be done during application (13 states do);

• provide review of insurers’ revocation of individual policies (Connecticut does);

• offer free independent reviews regardless of claim size (21 states do).

Taking their ball home
“Insurance companies can deny health coverage to people with pre-existing health conditions, refuse to pay for services needed to treat people with common ailments, and yank policies and deny payments when a consumer faces a rash of medical bills, and Nevada has no authority to protect consumers from such abuses,” Joe Edson of the Progressive Leadership Alliance of Nevada said.

But remedying that is complicated. Nevada is a small state. More to the point, Nevada is a small market. Insurance companies are perfectly willing to—and have done so in the past—leave the state if they don’t like the state’s regulatory rules. Congress has been of little help in providing protections that insurers cannot flee by crossing state lines.

Assemblymember Sheila Leslie of Washoe County says she intends to seek state legislative solutions, pointing to the Families USA report to demonstrate the need.

“The report does a good job pointing out specific areas of Nevada law that are not consumer friendly,” Leslie said. “I’m interested in promoting policies that will benefit consumers.”

She conceded that “the state is limited in the insurance companies it actually regulates and that most of those decisions really ought to be made at the federal level. Nevertheless, I feel obligated to research what can be done at the state level, and at the very least, engage in a public conversation about the inherent unfairness of allowing insurance companies to pick and choose who they want to insure and have no limits on how far they can go back in a person’s health history to find an excuse to exclude them.”

She said the frustration of patients needs to be addressed.

“Consumers absolutely need to find an outlet for their voice and register their complaints at a system that clearly isn’t meeting today’s needs. We’ve been waiting for a federal fix for so many years, and perhaps with a new dynamic administration we will start to see substantive change. But I’m not willing to continue to ignore the problem at a state level.”