Health reform payoff

Todd Dills | August 01, 2010

Owner-operators with pre-existing conditions often have been denied health coverage. Here’s how that’s changing.

For former leased contractor Gary Boyer, the inability to find health insurance for his family wrecked his stint as an independent carrier.

Michele White, owner of this International ProStar, has been able to buy in to a health plan offered by her carrier. Her truck, painted to spread the gospel of preventive health care through cancer screening, was the lead truck in the Convoy for a Cure breast cancer event last October. White says screening has saved her life five times.

“No insurance companies would touch me,” Boyer says. The reason was the pre-existing conditions of his son and daughter, 12 and 9, respectively. They take medications for diagnosed bipolar disorder and other conditions that cost Boyer and his wife, Mandy, upwards of $1,000 a month without insurance.

“As soon as they heard that,” Mandy says of insurers, “they basically just hung up.”

The Boyers’ situation is not unusual. Nearly 20 percent of all owner-operators have no health insurance, according to Overdrive research. Nationally, as many as 15 percent are uninsurable in the private, individual policy market due to a pre-existing condition like diabetes, high blood pressure or cancer.

For owner-operators in this group, help is on the way. Under the national health care reform bill passed this year, by 2014 it will be illegal for insurance companies to deny anyone coverage based on a medical condition. Until then, the bill seeks to address the long wait on pre-existing conditions by setting up a temporary nationwide high-risk pool (HRP) through which some uninsured people will be able to obtain benefits as early as this month.

The U.S. Department of Health and Human Services (HHS) began taking applications for coverage under the Pre-Existing Condition Insurance Plan July 1. To be eligible, a participant must be a citizen or other legal resident who has been without coverage for at least six months and who has a pre-existing condition that was cited by an insurance company to deny health insurance. Given the wide array of conditions insurers have used to deny coverage in recent times, the national HRP’s reach could be extensive.

Prior to the health care reform bill, 35 states offered their own HRPs. The plans’ average individual premiums were $485 monthly, according to a Government Accountability Office report issued in June 2009.

Compared to the state HRPs, the new temporary national pool will have greater state access to federal funds, as well as regulations that limit premium rates. The latter is done by pegging premiums to “standard rates,” which an individual without any pre-existing condition would pay for a comparable plan in the private market. In the state HRPs analyzed in the GAO report, premium levels were determined to be an average $110 higher than standard rates. Based on that, national HRP enrollees would save 22 percent in premium costs.

HHS gave all states the option of administering the national HRP themselves, in some cases alongside their own HRPs. The applications HHS began receiving July 1 are coming from enrollees in states that had not arranged to administer the national pool. A total 31 states, plus the District of Columbia, will administer the Pre-Existing Condition Insurance Plan. They include 22 states with their own existing state HRPs and nine without.

Among the 19 percent of owner-operators without health coverage, the age distribution generally reflects that of all owner-operators. This suggests factors unrelated to age, including costOf the 81 percent of owner-operators who have health coverage, almost four out of 10 are covered by a spouse’s plan. For the rest, the average premium was $570 per month, higher than the $485 nationwide average cost of health insurance in the 35 state-run high-risk pools. However, high-risk pool plans have relatively high deductibles of more than $1,300 on average. and pre-existing conditions, as reasons for lacking health insurance.

The national HRP stands to be a big benefit to high-risk residents of states like California, where new enrollments in the state HRP have been essentially cut off since a waiting list, in California’s case now at more than 1,000 people, was introduced in 2006. A comparable pool in Illinois also has a fairly long waiting list. Florida’s HRP has been cut off to new applicants for years.

As California began discussing its decision to administer the national HRP alongside its own HRP in June, the Sacramento Bee newspaper noted estimates that the national HRP would have a 37 percent lower enrollee cost. That spread “makes the reform real,” Health Access California head Anthony Wright told the paper.

Such health care savings would be great news for thousands of truckers who could benefit.

“I’m up to $450 a month,” says east Tennessee resident Michele White, an owner-operator leased to Crete Carrier, of her health insurance premium for the company’s group plan. White’s pre-existing conditions include five different cancers, which began with Hodgkin’s Disease in the late 1970s, and a replacement aortic valve in her heart. “Early detection can save your life,” she says, “and I’m walking proof.” strives to maintain an open forum for reader opinions. Click here to read our comment policy.