ShareThis Page

Cost crucial for uninsured sign-ups looking for health coverage

| Thursday, Jan. 16, 2014, 11:48 p.m.
Sidney Davis | Tribune-Review
Sam Morey is shown by the East End Food Co-Op in Point Breeze on Thursday January 16, 2014. Morey recently bought health insurance for the first time in five years.

When Sam Morey went shopping for insurance last month on, the 29-year-old from Bloomfield bought one of Highmark Inc.'s Community Blue plans.

Morey, who has had no health coverage since 2008, said he was not concerned that he wouldn't be able to go to most UPMC hospitals or see doctors in the region's largest health system.

The decision came down to cost. Community Blue's low monthly premium, the lowest in Western Pennsylvania, “was absolutely one of the deciding factors,” said Morey, who's paying $20 a month for Community Blue, thanks to $148 in monthly tax credits.

Thousands of consumers in the Pittsburgh area have made the same choice in the last three months. Highmark, the state's largest health insurer, dominates the online insurance marketplace formed under the Affordable Care Act with its low-cost, limited-network plans.

Insurers across the country are doing the same as they try to lower prices by offering plans that exclude some hospitals.

When it comes to individual insurance shoppers, especially those with lower incomes who are primary customers on, cost is the most important factor, said Karen Pollitz, a senior fellow at the nonpartisan Kaiser Family Foundation in California and an expert on health insurance.

“The individual market is very, very price sensitive,” Pollitz said.

The Affordable Care Act outlawed many of the ways health insurers previously lowered the cost of individual policies, such as not covering some medical conditions or setting annual limits on payments. Excluding more expensive hospitals is one of the few strategies left to insurers.

“This is the next easiest thing to manipulate,” Pollitz said.

A survey of health plan offerings in 20 marketplaces in large urban areas by McKinsey & Co. found last month that “narrow and ultra-narrow networks are more prevalent,” constituting 70 percent of health plan networks. Mc­Kinsey, a management consulting firm, found that broad network health plans were 26 percent more expensive on average than plans with narrow networks.

“Carriers are adapting to affordability imperatives by actively excluding some higher-cost hospitals while collaborating more closely with those willing to accept lower reimbursement rates,” the McKinsey report said.

Community Blue plans are 30 to 40 percent cheaper than offerings from its competitors, UPMC Health Plan and HealthAmerica, a subsidiary of Aetna Inc. The plans cost about 25 percent less than Highmark plans that do offer in-network access to UPMC hospitals and doctors.

For a 30 year old, premiums for Community Blue plans range from $129 to $183 depending on the level of coverage.

“That's a very clear way to lower costs, by having UPMC out of network,” spokeswoman Kristin Ash said. “We know very clearly that UPMC's costs are the highest in the region.”

UPMC also offers limited-network plans, which include all UPMC hospitals and “some community hospitals” in Allegheny, Beaver, Butler, Washington and Westmoreland counties. UPMC's Select plans cost between 7 percent and 17 percent less than its broader network plans.

All medical services outside the five-county area are charged at more costly out-of-network rates, except for emergency room visits, UPMC Health Plan spokesman Bill Modoono said.

Modoono declined to list which community hospitals were included in the network and which were not.

Insurance companies aren't always transparent about which facilities and doctors are out of network, Pollitz warned. Shoppers should check with the company about specific facilities before buying a plan, she recommended.

More than 37,000 people in Pennsylvania selected a Highmark plan on between Oct. 1 and Jan. 13, Highmark said this week. That's nearly half the 81,000 people statewide who selected any plan on the website, as of Dec. 28. And 80 percent of people in Western Pennsylvania selecting a Highmark plan chose Community Blue, the insurer said.

In addition to premium cost, Morey selected Community Blue because he hadn't had insurance in five years and had no relationship with local doctors.

“I already tested out my plan. I found a doctor and went for a physical,” Morey said. “I live in Bloomfield and I'm close to West Penn Hospital. ... It's better to have an affordable plan than pay $100 a month for a UPMC plan,” he said.

But for Barb Valaw, keeping access to her primary care physician, who's employed by UPMC, was paramount when she went shopping to replace a previous health plan that was canceled by Highmark because it didn't meet the more robust standards of the Affordable Care Act.

The 53-year-old independent contractor from Carrick said, “I wanted to duplicate my coverage and keep my doctors.”

Titus North, a certified application counselor with the Squirrel Hill consumer advocacy group Citizen Power, has noticed the same trend: People who previously had insurance are likely to have UPMC doctors and are not choosing Community Blue.

But, North said, most of the people he has helped to buy plans are new to health insurance, don't have doctors and are selecting Community Blue based on cost.

“They work very well for people who have not had insurance because they don't have doctors,” he said. “If you're going from nothing to Community Blue, it can be good.”

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or

TribLIVE commenting policy

You are solely responsible for your comments and by using you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.