Health Care Law’s Beneficiaries Reflect Its Strengths, and Its Faults

Health Care Law’s Beneficiaries Reflect Its Strengths, and Its Faults

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It has turned out that so many marketplace customers need expensive medical care that some insurers are spending more on claims than they earn in premiums. And the federal government’s strategies for protecting insurance companies from large losses have not been as effective as hoped.

Insurers, including a few big ones like Aetna and Humana, are withdrawing from the marketplaces in many states, saying they are losing too much money.

Others are sharply raising prices for next year, and the turbulence is fueling Republican criticism — including from Donald J. Trump during Sunday’s presidential debate, in which he called the rate increases “astronomical.”

A few customers can generate big costs.

Even a small number of customers with serious conditions can greatly increase costs. Roy Vaughn, a senior vice president at BlueCross BlueShield of Tennessee, said that just 5 percent of the company’s marketplace customers had accounted for nearly 75 percent of its claims costs.

The company recently announced that it would stop selling marketplace plans in Knoxville, Memphis and Nashville.

There are other reasons insurers are raising their rates or leaving the marketplaces. A big one is that the Obama administration, thwarted by Republican opponents in Congress, has paid out only a fraction of the $2.5 billion it owes insurers under a provision of the health law that was supposed to protect them against unexpectedly large losses during their first few years in the marketplaces.

But these payments would not be so important if more of the roughly 10 million marketplace customers were in good health. The Blue Cross Blue Shield Association reported in March that new customers who bought marketplace plans from its member insurers in 2014 and 2015 had higher rates of hypertension, diabetes, coronary artery disease, depression, H.I.V. and hepatitis C.

Chronically ill patients are worried about next year.

Many of these customers are in better shape after a few years with health insurance. But they are scared about the Affordable Care Act’s future.

Marque Dailey of Dallas, who has multiple sclerosis, said his marketplace plan from BlueCross BlueShield of Texas had paid for visits to a neurologist, physical therapy and an expensive drug called Lemtrada.

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Cooper Neill for The New York Times

Marque Dailey of Dallas, who has multiple sclerosis, said his marketplace plan from BlueCross BlueShield of Texas had paid for visits to a neurologist, physical therapy and a drug called Lemtrada that is administered through two series of infusions a year apart. The list price for the treatment is $158,000, although insurers usually negotiate lower rates.

When Mr. Dailey, now 32, was uninsured, he could not treat his symptoms and had to rely more and more on a wheelchair. The stiffness in his legs got so bad, he said, that he had to quit his part-time job as a merchandiser at Coca-Cola, which did not offer insurance. Now he is working again, as a field organizer for a Democratic state legislative candidate. But Blue Cross narrowed the network of doctors and hospitals he could use this year, and he is worried that 2017 will bring even fewer choices.

“I understand I’m an insurance loss,” Mr. Dailey said. “I do feel bad about it. But without this, I’m just kind of left out of everything.”

Costs are burdensome to customers, too.

Other marketplace customers with expensive medical needs pointed out that the costs had been a burden to them as well as their insurers, most of which remain profitable even as they lose money in the Affordable Care Act markets.

Vickie Wilkerson’s plan from Blue Cross and Blue Shield of Louisiana has paid about $21,000 this year for injections of Stelara, a drug that has helped her severe psoriasis.

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Cooper Neill for The New York Times

Vickie Wilkerson, 46, of Shreveport, La., has a plan from Blue Cross and Blue Shield of Louisiana that she said had paid about $21,000 so far this year for injections of Stelara, a drug that has helped her severe psoriasis. She pays just $5 per shot, but only because by the time her doctor prescribed it this year, she had already met the $6,000 deductible on her plan. Two emergency room visits, for bronchitis and a bad fall, had left her with thousands of dollars in bills.

She chose a high-deductible plan, she said, because the subsidy she received covered the monthly premiums in full. She had not anticipated needing emergency care or being put on such an expensive drug. Nor had she realized that by choosing a different type of plan with higher premiums, she could have qualified for extra federal aid that would have helped pay her deductible.

Ms. Wilkerson, who never had insurance through her longtime job as a housekeeper, relied on sporadic charity care until getting marketplace coverage in 2014.

Her worst fear, she said, is that insurance companies “will find some kind of loophole” to deny coverage to people with existing conditions, as they did before the health law was passed.

“I don’t know what I’d do,” she said.

Her insurer is raising rates an average of 24 percent next year. But Ms. Wilkerson is looking into whether she qualifies for Medicaid now that Louisiana has expanded it under the Affordable Care Act.

“I’m finally on a medication that is working,” she said. “I don’t want to have to stop that now and go back to the drawing board.”

Insurers are limiting choices.

Cathy Richardson of Elizabethtown, Pa., who works at her husband’s small financial planning business, was a healthy, low-cost customer for the first two years she had coverage through the Affordable Care Act. But early this year, Ms. Richardson, 54, received a diagnosis of Stage 3 rectal cancer and quickly became expensive to her insurer, Capital BlueCross. She has had two operations, chemotherapy, radiation and two additional hospitalizations.

There are signs that Ms. Richardson’s insurer is working to contain the costs of sick customers like her: It will not pay for treatment at the larger, more prestigious hospital in her area, requiring her to go to a smaller hospital instead. And a case manager from the insurance company calls her weekly to make sure she is getting the care she needs, which could prevent expensive complications.

The smaller hospital does not have a cancer center, so her oncologist, radiologist and surgeon do not work as a team. “You have to navigate between the three of them,” she said, “and you never know who to go to.”

Still, her costs have been limited to about $5,200. She is bracing for a letter from her insurer, due this month, that will notify her of any price increase and changes to her coverage for 2017.

“Our choices are probably going to be pretty limited,” she said.

Insurers are frustrated by customers dropping coverage.

The Obama administration is planning greater outreach, through advertising, social media, mailings and email, to new ways to persuade young, healthy Americans to buy marketplace coverage during the next enrollment period, which starts on Nov. 1. It is also taking other steps to address problems with the risk pool, which it says shows signs of improvement.

But insurers say they also wish the government could make it harder for people to drop their coverage after their health problem is treated. Health Care Service Corporation, which operates Blue Cross plans in five states, said less than half of its marketplace customers paid for coverage for the full year.

Ms. Latil dropped her coverage recently; she had finished her hepatitis treatment, a nearly six-month regimen of the drugs Sovaldi, Daklinza and ribavirin. It was not a willful swipe at the system, she said; she was struggling to make her premium payments of $179 a month.

“I got my stuff taken care of,” said Ms. Latil, who will soon have insurance through her job. “I am so extremely grateful.”

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