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Hospital Income for All

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Submitted By adrianette07
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Hospital Income for All
Reasons why Hospital Income should be available for people with chronic health issues.

Upon the start of this course my boyfriend’s son got sick. It wasn’t the first time that he’d gotten that sick because he has Sickle Cell Anemia. His deductible was high and he had lots of out of pocket expenses once the hospital stay lasted longer than expected. I began doing research on Hospital Income policies wondering if he would be eligible. Since I work for State Farm, I called a friend in Underwriting and was told that he was ineligible due to his preexisting condition. This was when I started comparing Hospital Income (HI) to the Affordable Care Act (ACA) wondering when all insurance will be on the same accord. What good is it when the people that need it most cannot use it?
Where the curiosity originated?
In the past two years I have become more educated on insurance products. Since I am pursuing a degree in Health Care quite naturally I was drawn to Health Insurance. An opportunity presented itself in a State Farm Agent’s office so I transitioned from sales to a more in depth position, which gave me the opportunity to expand upon my understanding of health products. Hospital Income was the first product that my new Agent taught me. This was where I was shown the statistical data behind why parents buy HI and why people do not buy it until it is too late. This curiosity lead to me purchasing a policy for my daughter and myself and pivoting to HI each time it was appropriate.
Basis for my research
Although there are several preexisting conditions to choose from, I decided to choose asthma because it yields the most data. Asthma is easily diagnosed and more patients are treated in the Emergency Room from asthma each year. Upon researching several conditions, asthma has the most patient trends and seems to be one of the most common reasons that patients visit the Emergency Room. Asthma was chosen from sickle cell, cancer, asthma and HIV/AIDS.
Number of people seen in ER each year for asthma. To make the sample easier to understand I have limited the information to asthma patients only. Each year, an estimated 1.81 million people with asthma require treatment in the emergency department with approximately 500,000 hospitalizations. (American Lung Association) These treatments can vary in cost from state to state and based on area. Some patients have private health care and some have coverage through the ACA so their deductibles can also vary. Blue Cross Blue Shield has a co-payment of $125 for emergency care. (Blue Cross Blue Shield of California, 2015) This can cost policyholders thousands of dollars a year in ER visits for having asthma alone, that’s not to mention any of the other preexisting conditions.
I will speak only in teams of State Farm’s HI policy and BCBS’ ER co-pay in this portion. With that being said, Hospital Income can save a policyholder all of their co-pay because the payout amount of the Hospital Income is more than the ER co-pay. For example, State Farm Insurance Companies offers $250 per occurrence with an additional $250 per day spent in the hospital if admitted. The patient will also receive an additional $250 if an outpatient surgery is required. (State Farm Insurance Companies, 2015) This can make a significant difference to a patient that has been admitted due to an asthma attack when the bills start to come in. The American Lung Association says, “The cost of illness related to asthma is around $19.7 billion per year in the United States.” (American Lung Association) The organization also says that 34.6% of these cases end in hospitalization. This can save these patients $250 per day. Some of these patients are adults that are losing wages due to hospitalization. That money can not only make up for those lost wages but also pay the patients co-pays, deductibles or any other personal fees that the patient incurs do to being hospitalized.
How this ties into the Affordable Care Act? The purpose of the Affordable Care Act is to reform health care so that more Americans have access to and are able to afford health care. Along with the reform, Americans are no longer being denied coverage due to preexisting conditions. Meaning, health care is now accessible, no matter what the health status. This was an issue for insurance companies because it forced them to accept the people that were previously denied coverage. Taking on a policyholder with a preexisting health issue can mean thousands of dollars in loss per claim. An insurance companies goal is to remain profitable and with the ACA now mandating the way policies would be underwritten, insurance companies were in trouble. So insurance companies had to take advantage somewhere. They did it by taking control over the policies that weren’t controlled by managed care.
How that affected Hospital Income? Since the ACA was suppose to reform health care and make it more affordable and more accessible the insurance companies changed their other policies to accommodate for the loss they took on Health Insurance. Hospital Income was one of the policies that suffered. The policy was drastically changed and the changes were more conditional than monetary. State Farm Insurance Companies realized how much of a loss it would be to cover the losses of preexisting conditions on regular health policies and Hospital Income so changes had to be made. They took the option away to rate (pay higher premium) a customer with a preexisting condition and made them ineligible all together. There has to be a better answer.
Health care reform should be made to reform all health care, not just some policies. What has been happening lately seems counterintuitive. As a health care professional I want to see everyone have the same opportunities. LeTourneau is a Christian University and since becoming a student here I have been looking at things beyond what is on the surface. Everything that happens is for a reason so why are we offering something to some but not to others? Some people have cancer, asthma or sickle cell. It is like having A, B, AB or O blood type. It is one of those things in life that we can’t just change about ourselves. Health insurance isn’t like car insurance. People that drive reckless have a choice. People that get asthma or inherit conditions from their family don’t. My Christian faith just won’t let me apply the same thinking to health. It’s just not fair.
Hospital Income is a very inexpensive policy. State Farm should offer the policy on conditional terms. The patient’s payout should be decreased once a certain number of Emergency Room visits have been reached. There is currently a maximum of three times per calendar year for State Farm Insurance Companies. (State Farm Insurance Companies, 2015) The payout should be reduced once they reach the 3rd ER visit of the year. The number of visits should also be extended to 3 visits per six months. These are just a few of the changes that I’d like to see.
This coverage can be more comprehensive to offer better options for those that need it most. Hospital Income is made to help those families that are in need of a supplemental coverage. That coverage is most needed by someone that is in the Emergency Room the most. The only issue is that they aren’t offered the coverage because of whom they are. I have had migraines since I was thirteen years old and they have become a part of me. I personally consider it discrimination to deny a person coverage because of something that has become a part of them. There is nothing they can do about it. Hospital Income was created for this reason and should be used for that reason. Hospital Income should be given to all.

Works Cited
American Lung Association. (n.d.). Retrieved 08 16, 2015, from lung.org: http://www.lung.org/associations/states/colorado/asthma/Asthma.html

Blue Cross Blue Shield of California. (2015). Live Fearless. (BCBS, Producer, & BCBS) Retrieved August 18, 2015, from Blue Shield: http://www.blueshieldca.com/sites/fep/documents/2015_PPO_sbs2sides_101414.pdf

Healthcare.gov. (n.d.). Retrieved August 22, 2015, from Coverage for Preexisting Conditions: http://www.healthcare.gov/health-care-law-protections/pre-existing-conditions/

Obama Care Facts . (n.d.). Retrieved August 22, 2015, from Affordable Care Act Summary: http://obamacarefacts.com/affordablecareact-summary/

State Farm Insurance Companies. (2015). Hospital Income Insurance-Texas. Retrieved August 20, 2015, from State Farm: http://www.statefarm.com/insurance/health/supplemental-insurance/texas/…...

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