Even with employer’s coverage, a family worries
When it’s annual health insurance enrollment time, Mark and Christine Leon of Pasadena pull out fat Manila folders holding last year’s medical records and health expenses. They sit at their plastic tablecloth-covered dining room table with a calculator, pencils and pads of paper making their best guesses at what next year’s medical needs will be.
They are among the 158 million Americans who get health insurance coverage through their employers. Mark, 47, is a mechanical design engineer at Northrop Grumman. Christine, 49, is a stay-at-home mother, and they and their three children, ages 17, 13 and 10, are all insured through Mark’s company.
First and foremost, Christine says, “we are so thankful to have this. It means so much.” And Mark echoes, “I can’t imagine how difficult it would be to live without it.”
But even for families who have good health insurance, the rules and the costs are so different across companies and states that it’s almost as though each of those 158 million people has a unique buying decision to make.
Most Americans are aware that they could be just a pink slip or a divorce away from losing their insurance. In a 2007 survey by the Harvard School of Public Health and the Kaiser Family Foundation, Robert Blendon, professor of health policy at Harvard, found that 26% of people say they are worried about losing their health insurance.
The worry is not unfounded. The number of uninsured Americans increased by 8.6 million between 2000 and 2006, according to the U.S. Census Bureau. During that same time, the percentage of employers who offered health insurance to their employees dropped from 69% to 61%, according to surveys by the Kaiser Family Foundation.
But those with employer-sponsored coverage have a lot of decisions to make, and some guesses to hazard. How healthy are family members? Does anyone anticipate needing specialty care for which they’ll want flexibility? How much are they willing to pay for increased choices?
One way to begin looking at the cost of health insurance to families is through averages. The average annual premium in 2007 for employer-sponsored health insurance was $4,479 for single coverage and $12,106 for family coverage, according to an annual survey by the Kaiser Family Foundation. The survey also found that a minority of companies pay the whole thing, but 80% of workers with single coverage and 94% of workers with family coverage contribute to the total premium. And the average annual contribution for single workers is $694, while those with family coverage contribute $3,281.
Dazed yet? There’s more. Workers with family coverage in large companies (200 or more workers) contribute less, an average of $2,831, than workers with family coverage in small firms (fewer than 199 employees), who average $4,236.
Then there’s the alphabet soup of coverage choices: HMO, PPO, POS or conventional fee-for-service plans -- all different deals. Some plans have fewer choices of physicians and hospitals, but no deductibles. Others have a wide choice of doctors and institutions, but patients might have to pay more, up to a limit that is different with each plan.
Finally, some companies have flexible spending accounts into which employees can contribute, in pretax dollars, what they think they’ll need for out-of-pocket health costs during the following year, regardless of which type of insurance plan they choose. People can pay their co-pays and deductibles out of those pretax dollars. These are not to be confused with high-deductible health plans, with a savings option, which provide catastrophic coverage and a deductible of at least $2,000 annually, for a family, before coverage kicks in. The savings option is where people, or sometimes the employer, can put money to cover the care they need that the plan doesn’t cover.
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Decisions, decisions
Despite its complexity, employer-sponsored insurance has one huge benefit beyond the comfort of providing access to health services. People don’t need to pass a health exam before qualifying, and employees are not eliminated from coverage if they have preexisting conditions. For children covered in their parents’ plans, it means no one asks whether they have asthma, scoliosis or any other condition before providing coverage.
Two of the Leons’ children were diagnosed with asthma when they were younger. Their trips to the emergency room, hospitalizations and treatment with medications, nebulizers and inhalers were all covered. Both children have done well for years, without asthma episodes.
Armed with information about this year’s company-sponsored choices, the Leons looked over information from his employer and again chose the Blue Cross/Blue Shield plan they’ve had for many years. The trick, for them, is to anticipate how much they should put aside in pretax dollars in a company-sponsored account to cover deductibles and co-payments. The guess has to be accurate, because at the end of the enrollment year, they could lose unspent money. They’ve guessed next year will be about the same as last year. “We pay out of our own pocket about $5,000 a year,” Mark says.
Money well spent for the peace of mind, they say. “The kids have always had their own pediatrician, their own dentist. They get vision care,” Christine says. “They have checkups once a year.
“We never hesitated in calling the doctor. There was always help there. If they said to take them to the hospital, we were off,” she says, snapping her fingers. “It’s enough to deal with emotionally when the kids are sick without worrying about how you’re going to pay for it. We never had that worry.” Mark adds: “We never had to say, ‘Let’s wait to see if it gets really serious.’ ”
They’ve had a frightening glimpse of how bad, and costly, medical problems can be for their children. When Daniel, the oldest, was born, he suffered meconium aspiration, a condition in which the newborn inhales a mixture of meconium and amniotic fluid. He spent time in the neonatal ICU, and after his lung collapsed, he had surgery. “The bill was somewhere between $100,000 and $200,000,” Mark says. “All covered by insurance.”
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The worry remains
Their biggest fear for the whole family is that Mark had a liver transplant in 1998. The anti-rejection medications and lifelong treatment he needs run about $2,000 a month, almost all of it covered by their insurance.
They worry that if he ever lost his job or couldn’t work, they could be up a creek and uninsurable. “As you get older, you think not just about earning an adequate amount of money,” Mark says. “You think more and more about the insurance coverage you get in a job.”
The china cabinet in the dining room is crammed with sports trophies, and the bulletin board on the wall is covered with meeting notices and everyone’s daily schedule: Pasadena community meetings, church choir practice, soccer, baseball, ballet lessons, Girl Scouts. Christine shuttles her kids around town, is a volunteer photographer for her church and fills her day taking care of the family. “But sometimes I feel guilty,” she says. “Maybe I should get a job with insurance. Even now I fear that if he were ever unable to work or lose his job, where would we be? We’d be ruined.”
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