The warnings that ObamaCare would especially hurt cancer patients were given last year, but liberals still insist on seeing no evil today. This week, Stephen Blackwood shared his mother’s story with the Wall Street Journal. Mr. Blackwood’s mother had insurance that covered the cancer drug Sandostatin, which was helping to keep her alive and well. But in November, Blue Cross/Blue Shield cancelled the plan because it was not in compliance with the Affordable Care Act regulations. Blackwood describes what happened next:
When finally she found a plan that looked like it would cover her Sandostatin and other cancer treatments, she called the insurer, Humana, to confirm that it would do so. The enrollment agent said that after she met her deductible, all treatments and medications—including those for her cancer—would be covered at 100%. Because, however, the enrollment agents did not—unbelievable though this may seem—have access to the “coverage formularies” for the plans they were selling, they said the only way to find out in detail what was in the plan was to buy the plan. (Does that remind you of anyone?)
With no other options, she bought the plan and was approved on Nov. 22. Because by January the plan was still not showing up on her online Humana account, however, she repeatedly called to confirm that it was active. The agents told her not to worry, she was definitely covered.
Then on Feb. 12, just before going into (yet another) surgery, she was informed by Humana that it would not, in fact, cover her Sandostatin, or other cancer-related medications. The cost of the Sandostatin alone, since Jan. 1, was $14,000, and the company was refusing to pay. [Wall Street Journal, February 23]
Why exactly did Mrs. Blackwood get stuck with a plan that doesn’t cover a drug that is crucial to her health? Liberal opinion writer Michael Hiltzik offers this answer:
The ACA doesn’t dictate which medications are or are not offered by insurers, and the law certainly doesn’t demand that information on formularies be withheld from customers. It sounds as if Mrs. Blackwood was sorely misled by Humana’s customer reps, and it seems likely that its refusal to cover her crucial medication is unjustified.
That does point to a problem with Obamacare, just not the one Stephen Blackwood and the Wall Street Journal think it does. The problem is that the Affordable Care Act not only left commercial insurers at the center of our healthcare system, but strengthened their grip on coverage. Many of the problems that have cropped up with the ACA are reflections of the private industry’s role, including its lousy customer service. [Los Angeles Times, February 24]
Hiltzik would have us believe that the next expansion of government control will do what the previous one failed to do: Make sure that the health care system provides exactly the right balance of quality service and low cost. But why does anyone believe that government is better than individual consumers at judging tradeoffs between cost and quality? In a market system that has real competition, companies don’t win customers by providing lousy service and a low-quality product. Government regulations suppress the competition that produces the incentives to give customers value.
Right now, only Humana knows why it doesn’t cover Sandostatin. But a search for an explanation for Mrs. Blackwood’s predicament should at least note how ObamaCare gives insurers incentives to narrow their offerings. Fortunately, we have Scott Gottlieb, who explained it in a column from last August:
Obamacare coaxes health plans to reduce spending and healthcare utilization by limiting the choices patients will have of doctors. This is the primary way that health plans are being cheapened enough to meet Obamacare’s strict guidelines on the low value of the coverage that the plans can offer.
Insurers are barred from using the other tools that they’ve traditionally employed to keep the costs of policies in check: cost sharing, underwriting risk, adjusting premiums and benefits. The only thing that health plans are permitted to do under Obamacare is narrow the networks of providers that they contract with. So that’s precisely what they’re doing. By contracting with fewer providers, insurers can cheapen their coverage by clamping down on what doctors prescribe.
This will hit cancer patients especially hard.
If consumers go outside the narrow network of doctors that their plans offer, patients will be saddled with heavy co-insurance that can make these options absurdly expensive. While Obamacare caps a person’s total out of pocket costs, the price of getting care outside your restricted provider network isn’t subject to these limits (except for care delivered in an emergency room). If patients see doctors outside their narrow networks, they’ll have to pay out of pocket for that care. They could be stuck with the entire bill. There are no limits under the law (with the only exception being out-of-network medical care delivered in an emergency room).
Yet cancer patients often need the help of specialized doctors and cancer institutions that won’t make it into many of these cheapened networks. The latest cancer drugs, as well as new (off label) uses for existing medicines, will also be harder to get. Patients may not be able to see the expert doctors most likely to offer these options. New drugs are also slow to make it onto the “treatment pathways” that Obamacare plans are using as a way to narrow the menu of drugs they cover. [Forbes, August 21, 2013]
The people who wrote ObamaCare were focused on figuring out how to control health care spending. That was their priority, and so, in a controlled market, it becomes the priority of the providers; but that is not necessarily the priority of individual consumers. The only way to make sure the priorities of consumers rule is to put consumers in charge not the government.