Health Insurance No Guarantee Against Ruin

Three-quarters of those bankrupted by medical costs were insured
By Matt Cantor,  Newser User
Posted Jul 1, 2009 8:06 AM CDT
In this July 31, 2008 file photo, a woman strides past the Hartford, Conn., headquarters of Aetna Inc.   (AP Photo/Bob Child, file)
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(Newser) – As lawmakers weigh health-reform plans, it’s becoming increasingly clear that just having coverage won’t necessarily protect individuals from financial disaster, the New York Times reports. Some three-quarters of those bankrupted by health care costs were insured at the time of their ailment. “Underinsurance is the great hidden risk of the American health care system,” says a law professor. “People do not realize they are one diagnosis away from financial collapse.”

Thus some are arguing for laws that guarantee “a base level of coverage” and protect against plans that are “relatively worthless,” the Times notes. Limited-benefit plans may pay, for example, for room and board at a hospital, but not for operations. Until “meaningful” insurance can be made more available, says a senator, “any presentation of limited-benefit plans ought to be completely straightforward, and not misleading in any way.”