NorthJersey.com

Health Care Eating Into N.J. Incomes

NorthJersey.com — Tuesday, May 12, 2009

BY MARY JO LAYTON
NorthJersey.com
STAFF WRITER

Nearly 1.5 million New Jersey residents spend more than 10 percent of their pretax incomes on health care — and 80 percent of them are insured, an advocacy group said today.

Higher premiums, rising copayments and deductibles as well as pricier treatment over the past nine years have led to a 43 percent increase in the number of people who have hit that spending bracket, according to Families USA, a Washington, D.C.-based advocacy group.

Of those numbers, 364,000 New Jersey residents are in families that will spend more than 25 percent of their incomes before taxes on health care, the report concluded.

"More and more families with insurance are affected by rising health care costs, and for many, the burden of these costs is becoming too great to bear," said Ron Pollack, executive director of Families USA.

Ken Colen, a 43-year-old cancer survivor, is one of the many who spend more than 10 percent of their pretax income on health care — even with good insurance.

Diagnosed with a rare cancer in July 2007 shortly after the birth of his third child, Colen was facing an $80,000 bill for treatment — on top of the $12,000 he paid for surgery.

For years, he had paid $1,600 in monthly premiums for coverage that included out-of-network care, which he received at Memorial Sloan-Kettering Cancer Center in New York City.

Under his policy, Colen said, he was responsible for costs up to $10,000. Yet his insurer insisted he was responsible for $80,000 worth of care for treatment that exceeded what his insurer considered "usual and customary" charges.

"It put such a drain and stress on us after battling cancer, radiation and chemotherapy," said Colen, who lives in Montclair. "I paid a premium to get good coverage and I was told I wouldn't be covered at the end of the day because of some fine print."

In fighting one bill for chemotherapy, Colen learned that his insurer only covered a dose of medication that was smaller than he was given.

"As if I'm supposed to stand there with a clipboard and count up doses before they infuse me with this poison that will save my life?" he said.

With the help of an attorney friend and the state Department of Banking and Insurance, Colen appealed and his bill was reduced to about $40,000, he said. The hospital also has offered a discount on his final bill, reducing it to about $31,000, he said.

Families USA's findings underscore the importance of delivering major health care reform by year's end as President Obama has urged, said U.S. Rep. Frank Pallone, the Monmouth County Democrat who is chairman of the energy and commerce subcommittee on health.

"This is a crisis for the underinsured as well as for those without insurance coverage," Pallone said at the teleconference announcing the numbers.

In addition to proposed reforms in Congress, the administration is seeking to lower the growth of national health spending by 1.5 percent a year over 10 years — an estimated savings of $2 trillion or more.

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