Child-only insurance dropped by some companies

September 22, 2010 12:00:00 AM PDT
Some parts of President Obama's new healthcare plan go into effect Thursday. Among them is a requirement that insurers can no longer reject children with pre-existing conditions. In response, some insurers now say they will stop selling policies for children altogether.

The new federal healthcare reform plan forbids insurers from rejecting coverage for children with pre-existing conditions.

Healthcare advocates say they're outraged companies like Anthem Blue Cross, Aetna, CIGNA and others are trying to circumvent that law by taking child-only policies off the market in states like California as early as this week.

"They're using children as hostages," said Anthony Wright, executive director of Health Access California. "It's a pretty stunning admission that they are only interested in covering healthy people, not sick people."

The move would only apply to new policies.

It will not affect existing child-only policyholders and family plans provided through their parents' work.

The insurance industry fears parents will buy policies only when their children become sick, causing a huge, expensive group to insure, with not enough premiums to cover the costs.

"If we have a system where people can drop in and out only when they need it the most, then it won't work," said Patrick Johnston, president and CEO of California Association of Health Plans.

Child-only policies are a pretty small market geared toward families who make too much to qualify for public programs and whose jobs don't offer dependent care.

Still, mothers like Ja'Net Hendricks, who has children with asthma, want the option there if she ever needs it.

"Just because we have kids, it's not our fault that our kids get sick or they come up with these diseases," said Hendricks.

Pediatricians insist it's more expensive to let kids go without insurance and stay sick.

"When you're letting those kinds of conditions go untreated, under-treated, then you're having more emergency room visits, more hospitalizations, and so obviously increasing healthcare costs," said pediatrician Elizabeth Miller, M.D.

The plan to eliminate child-only policies could have consequences for insurers in California.

A bill on Governor Schwarzenegger's desk bans health insurance companies from selling individual policies to anyone if they eliminate child-only plans. He has until the end of the month to act on it.


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