Free Health Insurance for thousands

Sunday, January 09, 2005



By Christopher Snowbeck, Pittsburgh Post-Gazette





Lower-income parents of about 8,500 children in Pennsylvania are paying for "Special Care" health insurance when their kids probably qualify for a free program from the state.



As a result, the state Department of Insurance has asked insurers that market low-cost Special Care-- Highmark Blue Cross Blue Shield and three other Blue Cross plans -- to notify families that purchase it about the state's free Children's Health Insurance Program (CHIP).



While the premiums and benefits in the four Special Care programs vary, everyone from state officials and consumer advocates to insurance company representatives agree that CHIP is the better deal, with richer benefits and no premiums.



Yet thousands of children are getting their coverage through Special Care.



"CHIP provides a broader set of benefits," said Pat Stromberg, a deputy commissioner for the Department of Insurance. "Everyone is curious why this phenomenon exists, and everyone is in agreement that we will improve information sharing [about CHIP] and then determine whether that's making a difference."



Paul Lodico, a consumer advocate with the Mon Valley Unemployed Committee, offered a sharper critique, noting that the Blue Cross plans administer CHIP for the state.



"It's an outrage," Lodico said. "It's inexcusable. Why is it happening? Highmark is the one who has to answer that. It looks like they're not being fair and open with consumers."



But that impression isn't true, countered Aaron Billger, a spokesman for Highmark.



"Highmark wants families to use CHIP and is making every effort possible to communicate the CHIP option to them," Billger said.



The Special Care programs and CHIP are meant to help a similar group of Pennsylvanians -- people who make too much money to qualify for Medical Assistance, the state Medicaid program for the poor, but can't afford private insurance.



People eligible for Special Care must earn less than 185 percent of the poverty level, or $34,873 for a family of four. CHIP benefits are available to families earning slightly more.



In Western Pennsylvania, a lower-income single parent could be saving $47 per month by enrolling a child in CHIP rather than Special Care, Lodico noted.



About 3,600 children were covered through Highmark's Special Care program in December, according to the insurance department. But some of those children might not be eligible for CHIP, said Billger, the Highmark spokesman. That's because families earning more than the income limit for CHIP can buy into a tier of Special Care with higher premiums, Billger said.



There could be a variety of explanations for those children who are both CHIP-eligible and enrolled in Special Care, he said.



Parents with coverage through Special Care might want the whole family in the same program for simplicity's sake, Billger said. That could be especially true if the family expects to gain employment-based coverage in the coming months, he said.



U.S. citizenship is required with CHIP, whereas Special Care is open to people who can document their residency here with a work visa, according to Billger. Fluctuations in family income might complicate the analysis, he added. A family that enrolled children in Special Care during the fall might be poor enough to qualify for CHIP by spring.



The bottom line, Billger said, is that Highmark is not steering people away from CHIP.



"Highmark discloses information about CHIP in all of its Special Care marketing materials," he said, adding that a foundation at Highmark screens Special Care applications, looking for children who qualify for CHIP. Stromberg, the state official, offered another possible explanation: The CHIP application form is lengthier and asks more personal questions than for Special Care's, so some might opt for less paperwork.



Stromberg said she met with representatives from the Blue Cross plans in December, and all four companies are committed to improving the way they inform future applicants about their options, she said.



"They all stepped to the plate and said there's more we can do," she said.



Lower-income families can't afford anything else, said Jon Stein, general counsel for Community Legal Services Inc. in Philadelphia. Stein's group stumbled upon the issue last fall when it was investigating the marketing efforts of the Blue Cross plans.



"You're taking money from low-income families for an inferior product?" he asked. "Most of us would walk across the street to pick up $600."