No "Cadillacs" in U.S. healthcare reform proposals

WASHINGTON (Reuters) - Some of the ideas proposed for U.S. healthcare reform could cost patients thousands of dollars a year out of their own pockets, and premiums could end up being too high, according to two reports.

One analysis for the American Cancer Society's Cancer Action Network showed a plan now offered to federal employees, including members of Congress, sometimes costs patients $7,000 a year in out-of-pocket expenses -- many of which a seriously ill patient would have no way of avoiding.

The Blue Cross/Blue Shield insurance plan, operated by Wellpoint Inc, has been called a "Cadillac" plan for its generous benefits by healthcare reform advocates, who compare it to the luxury car. They say it should form the minimum basis of what is offered to Americans under a reworked system.

But Karen Pollitz and colleagues at Georgetown University's Health Policy Institute who analyzed the plan for the Cancer Action Network found that even this plan leaves many gaps.

"It offers good protection by covering the most important benefits without caps and with an overall limit on cost-sharing liability. However, it is certainly not 'Cadillac' coverage," their report reads.

For instance, a breast cancer patient could pay $13,000 for her own care over two years, the analysis found.

President Barack Obama has made reform of the patchwork U.S. healthcare system his administration's showpiece priority and Congress is working on several ideas.

But Congress has run into problems over how to pay for a $1 trillion, 10-year overhaul. Much of the debate focuses on how to provide coverage for 46 million Americans who do not have private insurance and do not qualify for government programs such as Medicare or Medicaid.

A free, government plan is not even being discussed, and both Republicans and Democrats want consumers to pay at least part of their own way. Most proposals include expanding options for personal health insurance.

BANKRUPTED BY MEDICAL BILLS

But advocacy groups such as the Cancer Action Network point out that more than half of all U.S. bankruptcies were linked to medical debt -- and most of these people had health insurance.

"Too many cancer patients are delaying or forgoing lifesaving screenings and treatments because of access problems," said the group's president, Daniel Smith.

One such patient is Angela Kegler McDowell of Conway, South Carolina, a small business owner whose insurance company raised her premiums from $293 a month to $804 a month when her breast cancer returned. In January, the company stopped her coverage completely.

"It took my entire life savings," McDowell, 38, said in an interview. Even with insurance, McDowell estimates her cancer treatments cost her $42,000 out of pocket over five years.

Another report issued this week by the nonprofit Commonwealth Fund found that 73 percent of people who tried to buy insurance on their own in the last three years did not because the premiums were too high.

According to the report, 64 percent of adults with individual insurance spend $3,000 or more per year on premiums, compared to 20 percent of those with employer insurance.

It said patients using employer-provided insurance spent $2,250 out of pocket on average, including premiums, while those with individual market insurance spent $6,750.

A graphic showing state-by-state breakdowns of the uninsured can be seen here)