Out Of Work, Out Of Insurance, Out Of Luck

Leah Smith shells out more than $730 a month for health insurance but you won't hear her complaining.

Among the jobless, Smith is one of the lucky few with solid health insurance that she can afford. And it covers thousands of dollars in prescription drugs she could never pay for herself.

Health problems forced the 55-year-old to leave her job as a human resources director several years ago. She takes medication to help cope with spine problems, multiple sclerosis and high blood pressure, among other ailments.

She's covered under the Indiana Comprehensive Health Insurance Association, a state-backed safety net program, and pays $2,198 every three months. That's not cheap. It's about what the average worker pays over three years for her portion of a single-coverage plan through an employer, according to statistics from the nonprofit Kaiser Family Foundationm.

The Indiana insurance pool is one of the limited possibilities for people who lose their jobs and are searching for health insurance. It's a problem more Americans will face as more people lose jobs in the economic downturn.

"There are not adequate options," said Cheryl Fish-Parcham, deputy director of health policy at the nonprofit Families USA, which advocates health care reform. "People may face prices that are totally unaffordable, and they often can't get the same benefits they had before."

Still, Smith calls her insurance "a lifesaving plan."

She landed in Indiana's insurance safety net after first paying about $400 a month for 18 months of COBRA coverage. That's the program that allows a departing employee to remain under the employer's health plan by paying the full premium cost. Many unemployed people can't afford that, but Smith said disability insurance gave her a portion of her former salary to help cover it.

Once COBRA coverage ended, she searched for an individual policy and found it wasn't easy.

"I even wrote letters asking them to please cover me," she said. "They had no interest as soon as they learned of all the (health) issues."

Eventually, she found refuge in what's considered Indiana's insurance of last resort. The state helps fund the program, which charges relatively high premiums but provides its estimated 1,200 customers insurance with no lifetime maximum on benefits.

The program rejects no one and, like similar ones in 20 to 30 states, it provides coverage for people who can't afford it on the open market but are too well off to qualify for Medicaid.

To afford it, Smith scrimps in every possible way. She downsized from a condo to an apartment. She cut out basic cable and trimmed caller ID from her phone service.

"I go out to do dinner maybe twice a month, I don't go to fancy dinners," she said. "Obviously I don't go on a lot of occasions anymore."

In return, her insurance covers most of the expense of her nausea medicine, which costs about $1,600 for 120 pills. It also covers a patch she needs for nerve pain, a blood thinner, blood pressure drug and other medicines.

Many others in Indiana aren't so fortunate. The unemployment rate in this key presidential election state stood at 6.2 percent last month, a shade higher than the national figure, which experts say could rise in the coming months.

The first and best option for people who lose their employers' insurance is switching to coverage through a spouse or family member. Then there's COBRA, the Consolidated Omnibus Budget Reconciliation Act. The cost of extending this employer's insurance, however, usually rises about fivefold once you leave the payroll.

"You would go from paying 20 percent to paying all of it," said Karen Pollitz, a research professor at the Georgetown Health Policy Institute. She said the cost of a COBRA policy quickly becomes a "conversation stopper" for those who have just lost their income.

Poor families may find coverage through state programs like Medicaid. Some people might convert the group policy from their employer to an individual plan or buy a separate policy on the open market.

Insurers offer scores of individual plans for a wide range of prices. But these polices may not work if the applicant has a pre-existing condition. That can lead to insurance that costs too much or excludes expensive conditions like diabetes.

For Jeffrey Carroll, there were no affordable options when he lost his job as a truck driver. At $1,000 a month, COBRA proved too pricey for the 44-year-old with a wife and daughter. He also found nothing but big fees when he searched online. He said some polices wanted as much as $241 a week.

"They need to come up with an affordable plan for a common working man," said Carroll, who has since found another job and is waiting for health coverage to start. "Joe Blow off the street can't afford it."

Kimberly King has managed to get by more than five years without health insurance. She left her job as an accounting clerk in 2001 to take care of her sick mother, who died the next year. King, 46, dipped into her retirement savings to stretch COBRA coverage into 2002.

But now she can't find steady work for more than $7 an hour, let alone a job that also offers health insurance.

"I took bits and pieces of little jobs, and it's a joke," she said. "I can't even buy gas on $7 an hour."

King, who has no dependents needing coverage, says she hasn't looked for insurance because she knows she can't afford it. She used to visit the doctor twice a year for checkups. Now she pops vitamins and hopes to stay healthy.

That worked until she became dizzy and passed out about a year and a half ago.

An ambulance rushed her to Wishard Memorial, the public hospital serving Indianapolis. Doctors treated her for a urinary tract infection. The ambulance ride alone cost $400.

"I still haven't paid the bill yet," King said. "I'm probably going to be out a thousand bucks."

She thinks people like her might be helped if Barack Obama wins on Tuesday. She normally votes in every election, but this year offers extra incentive.

Smith, on the other hand, said her situation shows that coverage is available. People just have to look long enough and hard enough to find it.

"I think if you're determined to find something to get covered, I think it's out there," she said. "It's not going to fall in your lap."

Smith is leaning toward John McCain. She isn't eager to see a government-run health plan. She envisions long waits and limited choices of doctors.

Most importantly, she's worried she'll lose the security it took her a year and a half to find.

"I'm very nervous about that," she said. "I would hate for them to come and replace the health coverage I have."