Uninsurable on Account of Hangnail

Nyceve has been doing incredible work looking into the crisis of healthcare nationwide. Today, she highlights a disturbing LA Times story about how insurers in California pretty much refuse to cover potential consumers unless they're Jack LaLane (and even then, Jack had better not have a pre-existing condition).

Frankly today I don't know whether to laugh or cry. The stupidity. The abject stupidity. And Americans accept this as "normal"?

Perhaps something is wrong with us, with the citizens of the United States for tolerating this crap.

So without further delay, let's end the year on a high note.

And once again, ask yourselves, if our elected representatives suffered these indignites, remember they serve us , how quickly the for-profit insurance industry scam might collapse. Do you think they would tolerate such abuse?

In California, if you are say, self-employed (the backbone of the American economy, per George Bush), and you need to buy an individual health insurance policy, in a word. You. Better. Be. Healthy. Period.

This is what the Los Angeles Times is reporting this morning in a front page story. By the way, the reporter, Lisa Girion, deserves a Pulitzer for her ongoing and extraordinary coverage of the corrupt, cherry-picking health insurance industry in California.

Scott Svonkin joined the Los Angeles County Commission on Insurance 10 years ago because he was concerned about an emerging problem: people losing health coverage. Since then, the ranks of uninsured Americans have swelled to more than 46 million.

Svonkin almost became one of them.

. . .As it turned out, Svonkin was rejected by not just one but three of California's biggest health insurers, which cited his history of asthma, among other things.

"I couldn't buy it at any price," said Svonkin, 40, who lives in Sherman Oaks. "I remember thinking, 'This can't be happening to me.' "

I want to interject here at this point, because I am in exactly the same position as those in this article. I'm self-employed, living in California, and I have, in fact, a prior history of asthma. I had to practically beg Blue Cross to take me in 2004 (when I fully went free-lance, and dropped the coverage I had with my employer), and since I have had Achilles tendon surgery since then, I pretty much have to stay with the greediest, sneakiest, most depraved insurer in the nation. It seems like it's only gotten worse since then. As it is, I have high-deductible coverage that doesn't cover routine things like MRI's (which I paid completely out of pocket in the summer of '04). I can certainly afford coverage that's better, but at this point, nobody would cover me. This is well-known to anyone who has to arrange for their own insurance. I've been turned down before, even by so-called "good guys" like Kaiser. It's this knowledge, that any prior history will cause rejection, that pushes people to fib on their forms, which Blue Cross uses to its advantage later by dropping people after they make a claim. Blue Cross doesn't mind if you lie a little on your form if you pay them; it's only when you want something FROM them that they'll drop you.

Consumer advocates see the practice as cherry-picking — a legal form of discrimination that is no longer tolerated in schools, public accommodations or workplaces — and a way to guarantee profits.

"The idea is to avoid all risk," said Bryan Liang, executive director of the Institute of Health Law Studies at California Western School of Law in San Diego.

Jerry Flanagan, an advocate with the Foundation for Consumer and Taxpayer Rights, said it wouldn't take much to be left out of the private-insurance market. "A minor asthma condition or a surgery 10 years ago that requires no further medical care is enough to get you blacklisted forever," he said.

As a result, some people forgo treatment so as not to tarnish their health records. Others withhold information from doctors or ask them to leave details out of their records. For those who are uninsurable, healthcare often is the chief reason they stay in or take a certain job.

. . .Consumer advocates say out-of-date, ambiguous and even erroneous medical information can render people uninsurable. Sometimes the reasons can seem absurd. In a letter to an otherwise healthy recent college graduate, for instance, Blue Cross listed among the reasons it denied coverage a past bout of jock itch, "successfully treated with cream."

. . .Blue Shield declined to discuss Svonkin's case, citing patient privacy laws, as did the other insurers that subsequently rejected him, Blue Cross and PacifiCare. Although the rejection notices pointed to various problems — "expectant fatherhood" and swelling from a spider bite — all three blamed his history of asthma, a condition that affects more than 4.5 million Californians.

This is why we MUST have universal health care to prevent this kind of ruthlessness from happening. For-profit insurance companies have a responsibility to their shareholders and their corporate boards, and the people have no part in that.

Few mention this, but the American healthcare system is something of a mistake. It blossomed out of a World War II tax reform meant to guard against corporate war profiteering. Liberals, with their usual combination of good intentions and inadequate foresight, imposed massive marginal tax rates on corporations, effectively freezing their profits at prewar levels. But the law had a loophole: Corporations could funnel their wartime riches into employee benefits, such as healthcare, thus putting the cash to use within their company. And so they did, creating the employer-based healthcare system.

But healthcare was simpler in the 1940s, and far less expensive. In the 21st century, it's not simple at all. Once a perk of employment, health insurance is now a necessity, and a structure that dumps such power, complexity and cost in the laps of employers is grotesquely unfair to both businesses and individuals. There's no logic to an auto manufacturer running a multibillion-dollar health insurance plan on the side; it should stick to making cars. There's no excuse for pricing the self-employed and entrepreneurial out of the market. And there's no reason the owner of a three-employee start-up should have to go to bed with a heavy conscience because his coffee shop can't pay for chemotherapy.

But health insurance is not only the inexplicable responsibility of business; it is a big business, which is why the system survives. The medical-industrial complex is a massive, remarkable beast, consuming a full one-ninth of the American economy and offering astonishing profits to many of the participants (indeed, Big Pharma was the most profitable industry in the U.S. from the 1980s until 2003, when energy companies wrested away the top spot). As with any lucrative industry, the winners are resistant to reforms, and they have a formidable army of politically lobbyists, PR specialists and image consultants helping to preserve their position, to preserve a mistake.

It's unconscionable to keep the system the way it is, and I hope Ezra Klein is right, that change is around the corner. But to go into the buzzsaw that is the present insurance industry is going to take an enormous amount of political will, as well as a grassroots movement to understand the nature of the problem, and why going single-payer is the most rational alternative. I think Senator Wyden's proposal, which uses community rating to ensure everybody pays the same price no matter their expected level of care, deserves serious support and scrutiny. What will come out of California, which will certainly be a compromise, will go a long way to determining what will be acceptable to the nation at large. We should not lay down our arms for universal health care before those negotiations even begin. And we should not allow a system to continue where people who can afford quality care can't get it - because the insurance companies don't want to take the risk of paying even a dime to care for them.