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Survey: Out-of-pocket medical expenses skyrocketing

Bob and Kiran Shah of the Indian Shores Food Mart are raising their deductible to $5,000 just to keep the premium affordable.

CHERIE DIEZ | Times

Bob and Kiran Shah of the Indian Shores Food Mart are raising their deductible to $5,000 just to keep the premium affordable.

Carol Schaub of Madeira Beach is thinking about dropping her health insurance because she can't afford the $500 monthly premium. Bob Shah of Seminole increased the deductible on his family's plan to $5,000 to keep his rates affordable. Janet and David Quinn of Brooksville have put off needed treatments and medications for financial reasons.

These are a few faces of a trend that has seen the amount of money American families shell out for health care more than double over the past decade, according to a new study.

The report, released this month by the industry consulting firm Milliman, found that average out-of-pocket health care costs for a family of four with insurance have ballooned from $3,634 in 2002 to $8,008 this year.

And that's for families who get coverage from their employers. If you're paying COBRA premiums like Schaub, or buying on the individual market like the Shahs, the costs are often much higher.

Health experts and advocates say that rising heath costs will force more people to the ranks of the uninsured or force them to skip necessary care and medications. They say the federal health reform law may help, but most major provisions don't take effect until 2014.

What's a family to do until then?

"At this juncture there is no satisfactory answer," says Ron Pollack, executive director for Families USA, a nonprofit group that advocates for quality, affordable health care.

"There's enormous danger if someone feels they can't afford key health care services. Missing checkups, immunizations, prescriptions — they're playing Russian roulette with their health," he said.

• • •

For people like David and Janet Quinn, having health insurance is essential. He has hemochromatosis, a disorder in which too much iron gets absorbed from the gastrointestinal tract. She has fibromyalgia, which causes long-term, all-over pain and tenderness in joints, muscles and tendons.

So when David Quinn's employer stopped offering him health coverage last year, he quit and looked for another job that did, his wife said.

He found another home health nursing job with benefits, but the two quickly learned that employer-based coverage isn't what it used to be. Only $1,000 a year in health costs is covered; after that, they're paying out-of-pocket, his wife said.

The Milliman study, which analyzed data from a number of sources, found that while health care costs have gone up both for workers and employers, workers are feeling it more. Since 1992, the average share of health insurance premiums paid by employers has gone up 103 percent, while the average employee contribution to their health plans has gone up 130 percent.

Plus, many insurance plans are covering fewer services, and requiring higher deductibles, said Pollack, of Families USA.

David Quinn, 62, needs monthly phlebotomy treatments to remove excess iron and prevent the potentially serious complications of his condition. "But if we can't afford it, we cancel it," Joan Quinn said. "And wait 'til the next month."

• • •

The burden can be greater still for those who get no assistance from employers.

Carol Schaub, 62, elected to pay for coverage through COBRA after her husband, Chuck, died of cancer two years ago. COBRA is a federal program that allows Schaub to continue health coverage from her late husband's employer, but at a nonsubsidized rate.

She initially paid $900 a month for herself and her son Shaun, 20. But with the premiums eating up more than half of her $1,600 monthly Social Security check, she removed her son from the plan and now pays $500 a month for solo coverage.

In addition to her COBRA premium, Schaub, a retired nurse, spends $150 every three months for medications.

She also received a pain-relieving injection for her ailing shoulder but doesn't think she'll be able to afford a more permanent surgical fix for it.

She's thinking seriously about looking for a less-expensive catastrophic plan — and hoping nothing less than catastrophic goes wrong — until she reaches Medicare age.

As for her shoulder pain? "I'll probably grin and bear it for a while," she said. "Take Aleve and hope it goes away."

• • •

Bob Shah's health insurance premiums for his family of four have been raised nearly 20 times since 1999, when he paid $266 a month.

Informed that they'd be shooting to $713 in June, he raised his deductible to $5,000. That brings his monthly premium back down to $596 — but puts him at risk for much higher out-of-pocket costs.

"Every year they go up, even if I never go to the doctor," said Shah, 52, owner of Indian Shores Food Mart on Gulf Boulevard.

He says with pride that neither he nor his wife have any chronic health conditions. His children, both included in his policy, are also healthy.

Like Schaub, he, too, has considered dropping his insurance entirely and keeping what he spends on premiums in a savings account. But he knows even $700 a month won't pay for much.

"Then I tell myself I have to have insurance. Just in case," he said.

• • •

Starting in 2014, a number of provisions in the federal health reform law will help families, Pollack said.

Families earning less than 400 percent of the federal poverty level (currently $89,400 for a family of four) could receive subsidies to help pay for premiums. The law also sets limits on what families pay out of pocket for health care, Pollack said.

But for many, 2014 can't come soon enough. Shah looks at how he, a business owner, is struggling with rising premiums, and wonders how those with less income are coping.

"How are they paying for their health care?" he asked.

Richard Martin can be reached at rmartin@sptimes.com or (727) 893-8330.

Survey: Out-of-pocket medical expenses skyrocketing 05/30/11 [Last modified: Monday, May 30, 2011 11:41pm]
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