CoverTN is No Magic Cure for the Uninsured

April 28, 2008 10:00PM

By Drew Johnson Today marks the beginning of Cover the Uninsured Week. Tennessee bureaucrats plan to celebrate with a “Cover Tennessee Call-In For Coverage,” a taxpayer-funded advertising effort to increase participation in state-run healthcare schemes including CoverTN. Unfortunately, there is no reason to celebrate CoverTN. The state’s flawed insurance plan for uninsured working adults does not cover the costs resulting from many serious injuries or illnesses. In 2006, Gov. Phil Bredesen proposed CoverTN, an attempt to provide working Tennesseans who are not offered healthcare insurance through their employer the opportunity to purchase an affordable insurance plan. CoverTN’s costs are split evenly between the enrollee, the enrollee’s employer and taxpayers. The total monthly price tag per enrollee ranges from $113 per month for a young, non-tobacco user up to $327 per month for an obese smoker over the age of 65. On the surface it seems like a reasonable plan but, as is the case with so many government programs, the devil is in the details. The insurance, which is provided by BlueCross BlueShield of Tennessee, will not pay more than $25,000 in healthcare costs each year. Worse, only $15,000 of that can go towards hospital treatment. If a CoverTN enrollee is in an accident or diagnosed with an illness, only the first $25,000 is paid through insurance. The remaining balance comes out of the enrollee’s pocket. Since the program is aimed at Tennesseans who make less than $41,000, one illness or accident would leave many CoverTN enrollees in financial ruin. CoverTN’s own website is quick to boast that the insurance coverage begins with the first dollar spent on healthcare, with no deductible and only a $15 co-pay for doctor’s visits. But that does little to help. Nearly everyone in Tennessee can afford to pay $60 for strep throat treatment in a walk-in clinic. Nevertheless, CoverTN pays for that. Few, however, could afford a $28,000 angioplasty or a $36,000 knee surgery, but CoverTN only pays for the first $15,000 of those procedures. Imagine if your car insurance paid for oil changes and new wiper blades, but left you on your own if your car were stolen or totaled in an accident. Unfortunately for enrollees, that’s how CoverTN operates. If the state ends the CoverTN program—as it should—Tennessee’s uninsured working adults can still have access to useful, affordable health insurance. High-deductible health insurance plans, such as those already offered by BlueCross BlueShield and other health insurance providers, offer a simple, effective solution. Whereas CoverTN offers maximum coverage of $25,000 per year, high-deductible plans commonly offer $5 million lifetime limits. This means, unlike under CoverTN, a common surgery wouldn’t land enrollees in the poor house. The deductible generally ranges from $2,000 to $3,000 and health savings accounts can be set up to help enrollees pay for health-related costs until the deductible is met. There is good news for taxpayers as well. Since many high deductible plans cost less than CoverTN, taxpayers’ share could be reduced or eliminated. Cover the Uninsured Week is an appropriate time for Tennessee’s lawmakers to realize that, for enrollees of CoverTN at least, just being insured isn’t enough. # # #