Regence of Oregon "Evolve" plans: bad news for members

Health insurance reform may be the law of the land, but health insurance companies like Regence of Oregon aren't done screwing over their members/policy-holders.

My wife and I have individual Regence plans. Mine is the Blue Selections Premier, which I succeeded in switching to last year after going through a horrendous battle with the Regence underwriting department over some minor health problems (a.k.a. "preexisting conditions").

Recently we both got a packet from Regence BlueCross BlueShield of Oregon informing us that as of July 1 we'd need to switch to new plans, as our current plans will no longer be available.

Naturally our first thought was, "We're going to get screwed. The new policies are going to cost more and cover less."

Right on. Regence provided a comparison of my old plan and the new "Evolve Plus" plan that comes closest to what I have now.
Download Regence of Oregon new plan comparison

I'm going to pay $512 a month for the Evolve Plus, a bit more than the premium for my current $485 Premier plan. But the Evolve benefits have devolved downward, considerably. Here's an example:

Now there's a $500 deductible on brand name prescriptions, compared to no deductible before. Also, there is a $4,500 a year maximum prescription drug benefit, compared to no limit before. If someone is on expensive drugs for a serious condition, $4,500 will be used up quickly.

The basic Evolve plan, which my wife is to be switched to, is even worse: it has only a $1,000 maximum for all drugs. That's ridiculous.

It's impossible to compare the cost of the new and old plans, because the benefits have changed so much. This likely is one reason Regence is switching its individual policy holders over to the Evolve plans: instead of announcing another double-digit rate increase, Regence is keeping rates about the same and decreasing the value of benefits by double-digits.

Over on Blue Oregon I commented on a post about a proposal for an Oregon health insurance exchange. 

This sounds like a good idea. My wife and I have individual plans from Regence Blue Cross of Oregon. Recently we, like many others, received a packet notifying us that our plans will be terminated July 1 and we'll have to choose from the new Regence offerings they suggested.

Which offer considerably reduced benefits, albeit at roughly the same cost as our premium now. This, of course, means that Regence has raised its premium price, but not in an open and transparent manner. It's impossible to figure out how much more it will cost us out of pocket because Regence has reduced its benefit package.

Being in our early 60s with pre-existing conditions (who has been perfectly healthy all of his/her life?) we can't change to another health insurance company. I believe the health care reform provision prohibiting discrimination on the basis of pre-existing conditions doesn't kick in until 2014 or thereabouts. So Regence has us and tens of thousands of other individual policy-holders over a "take it or leave it" barrel.

No competition. No free market. The proposal laid out in this post would be a heck of a lot better, especially if the marketplace included a true "public option" run by the state of Oregon.

Last gripe about Regence: their informational materials about the new plans say there is a $2 million lifetime cap on benefits. But this is one of the provisions of the health care reform bill that kicks up immediately -- no more lifetime caps. I've emailed Regence and asked why they aren't complying with the law of the land. Seems crazy that new health insurance policies issued after passage of the bill don't reflect its provisions.

Today I called Regence and asked about the $2 million lifetime cap. I was told that Regence is complying with the health insurance reform bill and will implement its provisions as required.

OK. I didn't really expect that Regence would ignore the law. But it seems to be doing its best to get around it.

There no longer can be a lifetime cap on health insurance policies written after September 23, 2010. Existing policies with caps will change to the new "no cap" rule at renewal time.

So if we'd been able to stay on our current Regence plans, the $2 million lifetime cap limitation seemingly would have been removed on July 1, 2010 -- our renewal date. But Regence has chosen to force all of its individual policy holders to change to a new plan on July 1. Which obviously is before September 23.

How convenient. For Regence of Oregon.

Because now it looks like the lifetime cap will remain in place until July 1, 2011, which gives Regence a whole year during which it can tell members who have an expensive serious illness, "Tough. You've used up your $2 million. Better get going on your garage sale -- or bankruptcy plan."

Health insurance companies have a horrible P.R. problem. I don't know anyone, not a single person, who has good things to say about the health insurance industry. Like I said, when we got the mailing from Regence our first (and also last) reaction was:

This has got to be bad news. We're getting screwed. Regence never does anything that benefits its members or health care providers; it only cares about its own profit margin.

There's only one real solution to the problems health insurance companies cause: get rid of them. Or at least heavily regulate them. The reform legislation that's been passed does neither, unfortunately.

That's why I'm on the opposite side of the Republican mantra, "Repeal and replace."

No, we've got to keep what we have and make it much stronger. If insurance companies like Regence persist in playing their selfish corporate games at the expense of their policy holders, pressure will build for that to happen.

Comments

[Rain]

As long as the American people continue to support 30% for the insurance companies to manage their health care, this will continue to be the way of the land. I have not been happy with Democrats all the time but it's clear that November and voting will still have to be about party and if we vote Republican, we can see more profits for insurance companies, less controls over their policies and more people priced out of insurance even as they are legally required to get it with a fine taken out of their tax refund or charged through IRS if they don't. We have to make this work for all our sakes. What irks me is those who think it's about the poor. It's not about the poor but about the working and retired middle class. And it's about putting corporate interests ahead of individuals as we saw the Supreme Court do with their decision that made corporations a person for donating purposes.

[Mort]

If you would use a little logic, if you force the insurance to set no max limits on coverage, accept anyone regardless of condition, guess what you have to pay more. If the insured now have to pay for the uninsured, it will cost you more. Or are you on of the bright one, just want som Obama money. You have now entered Brian's great world pay more and get less, the church of praise Obama.
Get rid of most state mandates, allow insurance across state lines, stop covering aliens for free, have you been to an emerengcy room. They can have emerengcy care and deported.
State mandates require you to pay for coverage that you will never need or want, which is in part why it cost so much.

[KIM]

I also have this same policy. With the new one you don't get to see the doctor more then four times a year then you have to pay the 1000 dollars deductable. It's awful. I'm afraid. we don't have that kind of money.

[Carla]

Good news - these annual maximums should all go away at your policy renewal date after the health reform act goes into effect on 9/23/2010. Bad news - You'll probably see a significant rate hike associated with this change.

[Carla]

About your lifetime max. The health care bill does not go into effect until 9/23/2010. No insurance companies will remove lifetime maximum limits until this law goes into place, so it will be removed at your renewal FOLLOWING implementation of the law. Regence isn't ignoring or circumventing the law, they're abiding by it. The law applies to all plans (your old Selections plan and your new Evolve plan), so this doesn't have anything to do with switching you to a different plan. Either way, it doesn't take effect until 9/23/2010.

In addition, those types of benefit changes have to be filed and approved by the state. Currently, health insurance companies have new plans with the new provisions filed with the state and are waiting for approval before they can offer them in the market. By law, they have to do this. On that note, when these new Evolve plans were filed (public information) with the state, the Federal reform act hadn't even gone through the House, so there were no upcoming provisions for Regence to even consider including at that point in time.

[Carla]

The reality of a billbeing passed and a health insurance policy changing immediately is completely roadblocked by government entities. At a minimum, there is a 60 day review period AFTER the health insurance company files a new plan with the state. Generally, in Oregon, the Department of Insurance stretches this review time.

The bill was passed on 3/23/2010. The bill is very ambiguous in defining most provisions. The Federal government just started releasing (as of the last 2 weeks) guidance to health insurance companies on the details of the provisions and how this translates to coverage changes.

Take preventive care as an example. To simply say "preventive care must be covered in full with no cost share to the consumer" is not something that a health insurance company can act on without additional guidance. Physicians bill hundreds of thousands of different billing codes for various services. Without a defitinion of "preventive care," noone can move forward. Each of the services that fall under preventive care need to be listed. The Federal Government has been very slow to issue this guidance.

Given the state filing and review requirements, most insurance companies will not be able to implement changes in time for 9/23/2010.

[Carla]

As a side note, less than 10 people hit the lifetime max annually and they are all reinstated. Essentially, it serves no purpose as it is never enforced.

To reaffirm, your lifetime max would not have been removed on your Blue Selections plan in July 2010. It would not have been removed until your renewal following 9/23/2010. Unfortunately the reform act is complex and often misinterpreted/misquoted.

[Carla]

In reference to profit margin, I would check out the Department of Insurance posted information on insurance carrier financials. Regence has a average profit margin of 0.1% (yes, one tenth of one percent). Most industries range from 10%-50%. Each year, there's about a 50/50 chance that the company will have losses vs. gains. The last 3 years, it had losses.