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Health insurance for working poor under attack in Pa.

Published Jan 30, 2011 9:49 PM

Tom Corbett, Pennsylvania’s new governor, wasted no time in carrying out his pro-corporate, anti-working-class campaign promises to cut state services. On Jan. 11, a transition team official announced that adultBasic, the state’s subsidized health insurance for low-income workers, will likely end in February, impacting 42,000 enrollees and more than 479,000 on a waiting list.

David F. Simon, transition team chairperson for insurance matters, says the team negotiated an agreement with Blue Cross companies to waive their pre-existing condition restrictions so people can move from adultBasic to the Blues’ Special Care plans for those with low incomes. (Philadelphia Inquirer, Jan. 12)

The Special Care plans, however, charge premiums that are 400 percent higher than adultBasic, or $140 per month as opposed to $36, provide far fewer benefits and limit doctor’s office visits to four times a year.

Gene Bishop, a physician consultant to the Pennsylvania Health Law Project, which opposes the move, said, “Special Care is horrible insurance.” (Phila. Inquirer, Jan. 12).

Opponents of the proposal to eliminate adultBasic say that it would take less than 3 percent of the combined surpluses of the state’s four Blue Cross plans — which stood at $5.6 billion as of 2009 — to fully fund the plan without any state funds. They are calling on the Blues to continue adultBasic until 2014, when provisions of the federal health care overhaul that would replace programs like this go into effect.

As Pennsylvania’s attorney general, Corbett boosted his standing with conservatives by joining their national campaign to repeal President Barack Obama’s health care plan. As governor, he continues to support that effort.

Gov. Tom Ridge established adultBasic in 2002, using funds from Pennsylvania’s share of a national settlement with big tobacco companies. In 2005, the state’s Blue Cross/Blue Shield plans, under fire for their growing surpluses, agreed to contribute to adultBasic to satisfy the charitable obligation required to maintain their tax-exempt status. Incorporated as “non-profit hospital plans,” these companies are not subject to Pennsylvania’s insurance premiums tax.

From 2002 to 2009, the four state Blues’ cumulative surpluses grew from $3.5 billion to $5.6 billion, an increase of 61.4 percent. Their combined contributions to support adultBasic were around $500 million a year, hardly making a dent in their profits. Their agreement to fund adultBasic expired on Dec. 31.

AdultBasic provides health insurance to Pennsylvanians between the ages of 19 and 64 who are not eligible for Medicaid or Medicare. Their incomes cannot exceed 200 percent of the federal poverty level, or $21,660 for a single person, and $44,100 for a family of four. The plan covers hospital visits, preventive care, physician services, and treatment of illnesses and injuries.

The Pennsylvania Budget and Policy Center’s July report said that the waiting list for adultBasic has grown by more than 300,000 people since the recession began in December 2007. More than 85 percent of adultBasic enrollees have incomes below $30,000. Two-thirds are women. While one-third of enrollees are between 46 and 55 years of age, the largest buildup on the waiting list is of people between 19 and 26 as more young people lose their jobs and go without insurance.

The PBPC study says that the number of Pennsylvanians without health insurance had grown from 1 million in 2001 to 1.2 million by 2008, ranking second in the nation for the number of individuals who had lost employment-based coverage.