Editor's Note: This narrative originally appeared in the winter, 2012 edition of Health Elevations, the Colorado Health Foundation's award-winning quarterly journal.
Nathan Wilkes is co-founder of Headstorms Inc., a consulting firm, and serves on the board of the Colorado Health Benefit Exchange. He, his wife and their three children live in Arapahoe County.
"Do you have good insurance?"
Our newborn son had just been diagnosed with severe hemophilia, a chronic bleeding disorder, and this was the surprising first question from the hematologist we had been referred to.
Luckily, we had an excellent plan because I worked in a highly competitive technology industry where great benefits packages were common. Part of the reason we could get a good plan was that the workforce was relatively young and healthy. Unfortunately, one year and many expensive claims later, the insurance company decided to adjust our premiums accordingly.
When a 120-employee company suddenly has new additional annual claims pushing $1 million per year, the insurance underwriting process makes quality coverage very difficult to maintain. My company ended up having to switch from offering a PPO plan to a high-deductible health plan with a $10,000 annual deductible and a $1 million lifetime cap.
For our family, the cap represented an hourglass with a limited amount of sand. We could see the end coming, and the prospects were not good. Trying to find a comparable job would just postpone the inevitable. Social workers recommended a paper divorce so that our children could qualify for Medicaid, but that did not align with our family values. Ultimately, when our son hit the lifetime cap the following year, our only alternative was to put him into CoverColorado, the high-risk-pool insurance of last resort. Unfortunately, that also carried a $1 million lifetime cap.
By the time my son had exhausted his CoverColorado benefits, two things had changed for us. For one, Colorado had switched to modified community rating in the small group market in 2008, meaning businesses with 50 or fewer employees would no longer be subject to exorbitant premium swings due to sudden illnesses. Also, I was able to start my own consulting company that fit into this small group market. This allowed my new business to obtain group coverage at a more reasonable rate and have the flexibility to manage caps. As a result, Thomas, who is now 8, has had better care and is healthy and thriving.
Now, the Affordable Care Act both eliminates caps and provides community rating to the entire small group market, reducing access and affordability problems for many with high-cost illnesses. However, it can still be a challenge if the size of the employer exceeds the small group market limit, which by 2016 will only be 100. In Colorado, it is currently just 50 employees.
A sudden diagnosis of a life-threatening chronic or costly illness is not something anyone would normally anticipate. Preparing for the unexpected is one of the basic premises of insurance. Most people assume that the illness is our daily struggle, but they would be wrong. Our hematologist knew from experience that the constant illness-related issues are something you learn to live with. The real challenge for people like us is in maintaining adequate coverage to properly treat the illness and have a good, healthy outcome.