Inclusive Health offers insurance option to Pace employees

by Keith Barber

“Dianna, if you would please, just start this and I’ll get started,” said Stephen Flynn, an agent for Blue Cross Blue Shield, as he handed a health insurance enrollment form to Dianna Edwards.

“But I don’t know if we’re going to be able to afford this based on [my husband’s] salary,” Edwards said. “That’s the problem.”

Edward’s husband, Brian, is one of 337 Pace Airlines employees laid off last month. On Oct. 2, Dianna brought her 10-month-old daughter, Lexie, to an event sponsored by Inclusive Health at the Hawthorne Inn in Winston-Salem to assist former Pace Airlines employees with maintaining healthcare coverage.

Last Friday, marked the 63 rd day since Pace’s employees lost their healthcare coverage due to the fact the company stopped paying the premiums Aug. 1. Under federal law, people whose health insurance has been canceled must find new coverage within 63 days to avoid any preexisting-condition waiting periods, said Michael Keough, executive director of Inclusive Health.

As Lexie squirmed in her mother’s arms, Dianna explained to Flynn that she had applied for Medicaid to cover her 10-month-old and her 2-year-old son, Sean.

“I don’t want to sign anything until we know what we’re doing,” she said. “I don’t know if we’re going to be able to afford the insurance that we’re hopefully going to be getting. We’re not sure yet.”

Flynn assured Edwards that filling out the form did not obligate her in any way.

“We just have to do the underwriting,” he said.

The good news for Edwards and the hundreds of other family members of former Pace Airlines employees is that Inclusive Health, the state’s health insurance risk pool, received a two-week extension for Pace employees from the NC Department of Insurance due to the unusual nature of their situation, Keough said. Pace employees and their families now have until Oct. 16 to find health insurance to prevent a lapse in coverage.

On Sept. 23, Pace Airlines CEO William Charles Rodgers was arrested by NC Department of Insurance investigators at Piedmont Triad International Airport and charged with one count of willful failure to pay group health insurance premiums. State investigators allege that Rodgers terminated his employee group health insurance without providing the required 45-day notice to his 337 employees.

“Since people just heard [two weeks ago] about the insurance coverage issue, their clock only started ticking then, so we want to be as flexible as possible to help people get the coverage they need,” Keough said.

The news of layoffs and Pace’s insurance cancellation couldn’t have come at a worse time for Robin Roberts. Her husband, Jeff, is a former Pace Airlines employee who worked at the Winston-Salem-based airline for the past 14 months. Robin, a former women’s counselor for a nonprofit, was laid off from her job in February, and lost her healthcare coverage as a result. At the time, she and Jeff purchased a six-month major medical policy that expired on Aug. 6. Jeff’s group health insurance coverage with Pace Airlines was scheduled to begin the same day, so there would be no lapse in Robin’s coverage.

Jeff, who had worked for US Airways for 21 years, received his pink slip from Pace on Sept. 8. Three days later, he went to an employee meeting to sign up for unemployment insurance only to find out his health insurance was canceled Aug. 1.

To further complicate matters, Robin suffered a stroke on July 6. She thought the Blue Cross Blue Shield policy Jeff had through Pace would cover her physical therapy bills and diagnostic tests for the past two months. That was not the case.

Robin estimated her medical expenses could exceed $7,000. On Oct. 2, Blue Cross Blue Shield agents informed the Roberts that they could start a new policy immediately with no lapse in coverage. However, their rates would be significantly higher than what they had paid under the Pace group policy.

Physicians have informed Robin Roberts they expect her to have a 100 percent recovery, but while she’s disabled, she cannot look for work.

“I’m not even receiving unemployment,” she said.

Keough said Inclusive Health is a good alternative for someone in Robin’s position.

“We’re not created for healthy people,” Keough said. “A healthy person could find cheaper rates in the commercial market. We’re intended to be an alternative to that. By law, our rates are capped at 75 percent above the average rate for a healthy person in the individual market; in plain dollars, that’s $570/month.”

Inclusive Health follows the models of healthcare plans currently being debated in Congress that do not exclude anyone based on a preexisting condition.

“We’re publicly funded so we’re a child of state statute,” Keough said. “We don’t turn anybody down so we can’t deny anybody for coverage. We don’t do any underwriting so we don’t change anybody’s rates because they have diabetes, or cancer or some other diagnosis.”

People in Roberts’ situation comprise roughly 20 percent of Inclusive Health’s clients, Keough said. Inclusive Health enrollees have a preexisting waiting period of six months, which means anything they’ve had treatment for in the previous 12-month period is not covered for the first six months of their policy.

And the 337 former Pace employees are part of a growing trend in the state, Keough added.

“It’s less unique than we would like to think — 54 percent of our enrollees are people who have exhausted their COBRA coverage,” he said. “Typically 18 months is intended to be enough time to find another job…. We’re an employer-based health coverage system, but what we’re finding is that there’s large numbers, because of the state of the economy, are not able to find new coverage so at the end of the 18-month period.”

Dianna Edwards decidedshe and her family could probably find better rates in the commercialmarket but money remains a big issue. Her husband is still awaiting hisfinal check from Pace, so making the family’s health insurance premiumpayments will be a challenge until Brian gets back on his feet. Diannasaid she was pleased Inclusive Health came to the aid of her family,but “what is very disheartening is that no one was doing anything untilthe insurance companies weren’t getting paid,” she said.

InclusiveHealth and the other 34 state insurance risk pools around the nationcould play a major role in the lives of people like Robin Roberts andDianna Edeards, as well as the national debate on health care reform,Keough said.

“Theidea that the President suggested was risk pools play an interim role,a transitional role, until health reform — whatever form it takes —kicks in in earnest in 2013, because we’re on the ground,shovel-ready,” he added. “We’re in a position with infrastructure andthe ability to do all the things insurers need to do to serve peoplefairly readily, so at that point it’s just a matter of funding.”

Asthe state’s insurer of last resort, the number of Inclusive Healthenrollees is growing daily. Inclusive Health has enrolled 2,155 NorthCarolinians since January, “so we’re obviously just scratching thesurface,” Keough said.

Dianna Edwards (far left) attended Inclusive Health’s event for PaceAirlines employees in Winston-Salem on Oct. 2. Edwards’ husband waslaid off last month after finding out his health insurance premiums hadnot been paid by the company since Aug. 1. (photo by Keith T. Barber)