Amazon has finished its $3.9 billion acquisition of most important care company 1 Health-related, the tech large announced Wednesday.
The Federal Trade Fee has made the decision it will never obstacle Amazon’s deal for Just one Clinical, according to Politco.
WHY THIS Matters
The closing marks a further deal in the move in direction of the retailization of health care, a trend Bain & Enterprise predicts will improve to take in shut to a third of the principal treatment marketplace. Nontraditional players this sort of as Amazon, CVS Health, Walgreens Boots Alliance and Walmart will personal as significantly as 30{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the most important treatment market by 2030, the consulting organization reported in the report cited by the American Hospital Association.
Pharmacies and many others compete on the convenience element.
One particular Health care offers similar and next-working day in-business office or remote visits, paired with 24/7 on-desire digital treatment products and services, Amazon mentioned. It gives a A single Health care application for the on-demand from customers online video chats and “Handle Me Now” assessments for prevalent overall health problems, vaccine and clinical-file accessibility, prescription renewals, and proactive reminders for observe-up care and referrals.
It also has on-site labs and programs for preventive care, serious-care management, popular ailments and psychological health and fitness issues.
Jointly, Amazon and A single Health-related seem to provide outstanding health care to much more persons to attain far better health results, superior care experiences and more benefit, in just a far better treatment workforce environment, Amazon claimed.
The business product is dependent on paid out yearly memberships. For a minimal time, A single Medical is offering once-a-year memberships at a discounted rate of $144 for the initially calendar year. The price tag is routinely $199 for each year. Membership addresses on-desire and digital treatment providers as effectively as coverage navigation and referral administration.
Key care suppliers can spend extra time with individuals than what they customarily get in a doctor’s office, to support manage a person’s total wellness needs from preventive to acute treatment, chronic sickness administration and psychological wellbeing issues, Amazon explained. Pediatricians and family treatment suppliers out there in a developing number of locations to serve children and families.
1 Clinical features clinical and electronic integrations with hospital networks throughout the United States.
“We are on a mission to make it dramatically much easier for men and women to locate, choose, manage, and engage with the companies, merchandise, and professionals they need to get and stay healthy, and coming collectively with One Medical is a large step on that journey,” said Neil Lindsay, senior vice president of Amazon Health and fitness Companies.
“If you quickly ahead 10 a long time from now, individuals are not heading to believe that how principal treatment was administered,” said Amazon CEO Andy Jassy. “For decades, you termed your medical doctor, produced an appointment 3 or 4 weeks out, drove 15-20 minutes to the physician, parked your car, signed in and waited quite a few minutes in reception, finally have been positioned in an exam place, in which you waited one more 10-15 minutes right before the physician came in, observed you for five to 10 minutes and prescribed medicine, and then you drove 20 minutes to the pharmacy to pick it up – and that is if you did not have to then go see a professional for more analysis, the place the procedure repeated and could get even more time for an appointment.”
THE Bigger Trend
In January, Amazon cleared a hurdle in getting A single Professional medical by receiving approval from the Oregon Wellbeing Authority. Acceptance was required for the reason that A single Health care operates 5 clinics in the Portland area.
The acquisition awaited acceptance from the Federal Trade Fee.
Twitter: @SusanJMorse E-mail the author: SMorse@himss.org
Patients at North Carolina-based Atrium Health get what looks like an enticing pitch when they go to the nonprofit hospital system’s website: a payment plan from lender AccessOne. The plans offer “easy ways to make monthly payments” on medical bills, the website says. You don’t need good credit to get a loan. Everyone is approved. Nothing is reported to credit agencies.
In Minnesota, Allina Health encourages its patients to sign up for an account with MedCredit Financial Services to “consolidate your health expenses.” In Southern California, Chino Valley Medical Center, part of the Prime Healthcare chain, touts “promotional financing options with the CareCredit credit card to help you get the care you need, when you need it.”
As Americans are overwhelmed with medical bills, patient financing is now a multibillion-dollar business, with private equity and big banks lined up to cash in when patients and their families can’t pay for care. By one estimate from research firm IBISWorld, profit margins top 29{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} in the patient financing industry, seven times what is considered a solid hospital margin.
Related: How to avoid medical debt and how to get out of it
Hospitals and other providers, which historically put their patients in interest-free payment plans, have welcomed the financing, signing contracts with lenders and enrolling patients in financing plans with rosy promises about convenient bills and easy payments.
For patients, the payment plans often mean something more ominous: yet more debt.
Millions of people are paying interest on these plans, on top of what they owe for medical or dental care, an investigation by KHN and NPR shows. Even with lower rates than a traditional credit card, the interest can add hundreds, even thousands of dollars to medical bills and ratchet up financial strains when patients are most vulnerable.
Robin Milcowitz, a Florida woman who found herself enrolled in an AccessOne loan at a Tampa hospital in 2018 after having a hysterectomy for ovarian cancer, said she was appalled by the financing arrangements.
“Hospitals have found yet another way to monetize our illnesses and our need for medical help,” said Milcowitz, a graphic designer. She was charged 11.5{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} interest — almost three times what she paid for a separate bank loan. “It’s immoral,” she said.
MedCredit’s loans to Allina patients come with 8{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} interest. Patients enrolled in a CareCredit card from Synchrony, the nation’s leading medical lender, face a nearly 27{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} interest rate if they fail to pay off their loan during a zero-interest promotional period. The high rate hits about 1 in 5 borrowers, according to the company.
For many patients, financing arrangements can be confusing, resulting in missed payments or higher interest rates than they anticipated. The loans can also deepen inequalities. Lower-income patients without the means to make large monthly payments can face higher interest rates, while wealthier patients able to shoulder bigger monthly bills can secure lower rates.
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More fundamentally, pushing people into loans that threaten their financial health runs against medical providers’ first obligation to not harm their patients, said patient advocate Mark Rukavina, program director at the nonprofit Community Catalyst.
“We’re dealing with sick people, scared people, vulnerable people,” Rukavina said. “Dangling a financial services product in front of them when they’re concerned about their care doesn’t seem appropriate.”
Debt upon debt
Nationwide, about 50 million people — or 1 in 5 adults — are on a financing plan to pay off a medical or dental bill, according to a KFF poll conducted for this project. About a quarter of those borrowers are paying interest, the poll found.
Increasingly, those interest payments are going to financing companies that promise hospitals they will collect more of their medical bills in exchange for a cut.
Hospital officials defend these arrangements, citing the need to offset the cost of offering financing options to patients. Alan Wolf, a spokesperson for the University of North Carolina’s hospital system, said that the system, which reported $5.8 billion in patient revenue last year, had a “responsibility to remain financially stable to assure we can provide care to all regardless of ability to pay.” UNC Health, as it is known, has contracted since 2019 with AccessOne, a private equity-backed company that finances loans for scores of hospital systems across the country.
This partnership has had a substantial impact on patient debt, according to a KHN analysis of billing and contracting records obtained through public records requests.
Related: How safe is your hospital? Every Tampa Bay hospital graded.
UNC Health, which as a public university system touts its commitment “to serve the people of North Carolina,” had long offered payment plans without interest. And when AccessOne took over the loans in September 2019, most patients were in no-interest plans.
That has steadily shifted as new patients enrolled in one of AccessOne’s plans, several of which have variable interest rates that now charge 13{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a}.
In February 2020, records show, just 9{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of UNC patients in an AccessOne plan were in a loan with the highest interest rate. Two years later, 46{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} were in such a plan. Overall, at any given time more than 100,000 UNC Health patients finance through AccessOne.
The interest can pile on debt. Someone with a $7,000 hospital bill, for example, who enrolls in a five-year financing plan at 13{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} interest will pay at least $2,500 more to settle that debt.
Rukavina, the patient advocate, said adding this burden on patients makes little sense when medical debt is already creating so much hardship. “It may seem like a short-term solution, but it leads to longer-term problems,” he said. Health care debt has forced millions of Americans to cut back on food, give up their homes, and make other sacrifices, KHN found.
UNC Health disavowed responsibility for the additional debt, saying patients signed up for the higher-interest loans. “Any payment plans above zero-interest terms/conditions in place with AccessOne are in place at the request of the patient,” Wolf said in an email. UNC Health would only provide answers to written questions.
UNC Health’s patients aren’t the only ones getting routed into financing plans that require substantial interest payments.
At Atrium Health, a nonprofit system with roots as Charlotte’s public hospital that reported more than $7.5 billion in revenues last year, as many as half of patients enrolled in an AccessOne loan were in one of the company’s highest-interest plans, according to 2021 billing records analyzed by KHN.
At AU Health, Georgia’s main public university hospital system, billing records obtained by KHN show that two-thirds of patients on an AccessOne plan were paying the highest interest rate as of January.
‘Empathetic patient financing’
AccessOne chief executive Mark Spinner, who in an interview called his firm a “compassionate, empathetic patient financing company,” said the range of interest rates gives patients and medical systems valuable options. “By offering AccessOne, you’re creating a much safer, more mission-aligned way for consumers to pay and help them stay out of medical debt,” he said. “It’s an alternative to lawsuits, legal action, and things like that.”
AccessOne, which doesn’t buy patient debt from hospitals, doesn’t run credit checks on patients to qualify them for loans. Nor will the company report patients who default to credit bureaus. The company also frequently markets the availability of zero-interest loans.
Some patients do qualify for no-interest plans, particularly if they have very low incomes. But the loans aren’t always as generous as company and hospital officials say.
AccessOne borrowers who miss payments can have their accounts returned to the hospital, which can sue them, report them to credit bureaus, or subject them to other collection actions. UNC Health refers unpaid bills to the state revenue department, which can garnish patients’ tax refunds. Atrium’s collections policy allows the hospital system to sue patients.
Because AccessOne borrowers can get low interest rates by making larger monthly payments, this financing system can also deepen inequalities. Someone who can pay $292 a month on a $7,000 hospital bill, for example, could qualify for a two-year, interest-free plan. But a patient who can pay only $159 a month would have to take a five-year plan with 13{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} interest, according to AccessOne.
“I see wealthier families benefiting,” said one former AccessOne employee, who asked not to be identified because she still works in the financing industry. “Lower-income families that have hardship are likely to end up with a higher overall balance due to the interest.”
Andy Talford, who oversees patient financial services at Moffitt Cancer Center in Tampa, said the hospital contracted with AccessOne to make it easier for patients to manage their medical bills. “Someone out there is helping them keep track of it,” he said.
But patients can get tripped up by the complexities of managing these plans, consumer advocates say. That’s what happened to Milcowitz, the graphic designer in Florida.
Milcowitz, 51, had set up a no-interest payment plan with Moffitt to pay off $3,000 she owed for her hysterectomy in 2017. When the medical center switched her account to AccessOne, however, she began receiving late notices, even as she kept making payments.
Only later did she figure out that AccessOne had set up two accounts, one for the cancer surgery and another for medical appointments. Her payments had been applied only to the surgery account, leaving the other past-due. She then got hit with higher interest rates. “It’s crazy,” she said.
Growing business opportunities
While financing plans may mean more headaches and more debt for patients, they’re proving profitable for lenders.
That’s drawn the interest of private equity firms, which have bought several patient financing companies in recent years. Since 2017, AccessOne’s majority owner has been private equity investor Frontier Capital.
Synchrony, which historically marketed its CareCredit cards in patient waiting rooms, is now also inking deals with medical systems to enroll patients in loans when they go online to pay bills.
“They’re like pilot fish eating off the back of the shark,” said Jonathan Bush, a founder of Athenahealth, a health technology company that has developed electronic medical records and billing systems.
As patient bills skyrocket, hospitals face mounting pressure to collect more, which can make financing arrangements seem appealing, industry experts say. But as health systems go into business with lenders, many are reluctant to share details. Only a handful of hospitals contacted by KHN agreed to be interviewed about their contracts and what they mean for patients.
Several public systems, including Atrium and UNC Health, disclosed information only after KHN submitted public records requests. Even then, the two systems redacted key details, including how much they pay AccessOne.
AU Health, which did not redact its contract, pays AccessOne a 6{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} “servicing fee” on each patient loan the company administers. But like Atrium and UNC Health, AU Health refused to provide any on-the-record interviews.
Other hospital systems were even less transparent. Mercyhealth, a nonprofit with hospitals and clinics in Illinois and Wisconsin that routes its patients to CareCredit, would not discuss its lending practices. “We do not have anyone available for this,” spokesperson Therese Michels said. Allina Health and Prime Healthcare also wouldn’t talk about their patient financing deals.
Bush said there’s a reason so few hospitals want to discuss their financing deals: They’re embarrassed. “It’s like they quietly write someone’s name on a piece of paper and slide it across the table,” he said. “They don’t want to be a part of it because they have in their institutional memory that they are supposed to look after patients’ best interests.”
Some hospitals choose another path
Not all hospitals expose their patients to extra costs to finance medical bills.
Lake Region Healthcare, a small nonprofit with hospitals and clinics in rural Minnesota that contracts with Missouri-based Commerce Bank, charges no interest or fees on payment plans. That’s a decision that spokesperson Katie Johnson said was made “for the benefit of our patients.”
Even some AccessOne clients such as the University of Kansas Health System shield patients from interest. But as providers look to boost their bottom lines, it’s unclear how long these protections will last. Colette Lasack, who oversees financing for the Kansas system, noted: “There’s a cost associated with that.”
Meanwhile, large national lenders such as Discover Financial Services are looking at the patient financing business.
“I’ve had to become more of a health care marketer,” said Matt Lattman, vice president for personal loans at Discover, which is pitching the loans to people with unexpected medical bills. “In a world where many people are ill prepared to cover their health care costs, the personal loan can provide an opportunity.”
Kaiser Health News is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
• • •
About this project
“Diagnosis: Debt” is a reporting partnership between KHN and NPR exploring the scale, impact, and causes of medical debt in America.
The series draws on the “KFF Health Care Debt Survey,” a poll designed and analyzed by public opinion researchers at KFF in collaboration with KHN journalists and editors. The survey was conducted Feb. 25 through March 20, 2022, online and via telephone, in English and Spanish, among a nationally representative sample of 2,375 U.S. adults, including 1,292 adults with current health care debt and 382 adults who had health care debt in the past five years. The margin of sampling error is plus or minus 3 percentage points for the full sample and 3 percentage points for those with current debt. For results based on subgroups, the margin of sampling error may be higher.
Additional research was conducted by the Urban Institute, which analyzed credit bureau and other demographic data on poverty, race, and health status to explore where medical debt is concentrated in the U.S. and what factors are associated with high debt levels.
The JPMorgan Chase Institute analyzed records from a sampling of Chase credit card holders to look at how customers’ balances may be affected by major medical expenses.
Reporters from KHN and NPR also conducted hundreds of interviews with patients across the country; spoke with physicians, health industry leaders, consumer advocates, debt lawyers, and researchers; and reviewed scores of studies and surveys about medical debt.
“It’s a little something we’ve actually been searching ahead to,” he mentioned.
Past month, the Salls got the e-mail from the pump’s maker that they’d been ready for: “We are enthusiastic to let you know” the new pump (called an Omnipod 5) “can now be recommended by your doctor. We are thrilled this working day has arrived.”
Quickly, Cate’s endocrinologist at Baystate Clinical Centre in Springfield wrote the prescription. (The Salls are living in the western Massachusetts town of Sunderland.)
Then, the challenges started.
On May well 23, the Salls obtained a voicemail from the endocrinologist’s workplace: “It appears to be like when we did the genuine insurance policies eligibility verify they are telling us the Omnipod 5 is nonetheless a program exclusion.”
Daniel Salls mentioned he instantly identified as his family’s wellbeing insurance provider, Issue32Wellbeing (which is the identify of the enterprise immediately after the merger of Harvard Pilgrim Health Treatment and Tufts Wellbeing System) to obstacle the exclusion.
But Daniel claimed the conversation ended without the need of him sensation satisfied that he understood why the pump was not becoming coated. That is when he wrote to me, top me to inquire Stage32Health about the “plan exclusion,” which is a provision in an coverage plan that gets rid of protection for specified factors.
Level32Wellbeing replied to me with no mentioning “plan exclusion.” As a substitute, it claimed the pump in question “is not at the moment accessible for prescription as it is in constrained industry launch and not offered to the general public.”
Elizabeth Salls smiles at her daughter Cate.Chris Marion Sr for The Boston Globe
The moment the Omnipod 5 method is produced obtainable for prescription, Stage32Wellness will “fully assess” it “for plan and coverage choices,” the e-mail stated. That sounded to me like a recipe for far more delay.
Later on that day, the Salls obtained an unanticipated call from their insurer providing them a “prior authorization” quantity, together with guidance to give it to their endocrinologist.
A prior authorization, in well being insurance plan jargon, normally indicates acceptance of coverage, the reverse of “plan exclusion.”
“Fingers are crossed, we’ll see where by another three hrs on the cell phone sales opportunities tomorrow,” Daniel advised me in a textual content information, with only slight exaggeration. He also reported he imagined my involvement might have performed a function: “There was a definitive improve in the tone and tenor of our interactions with them as the working day progressed.”
The upcoming conversation I been given from Place32Wellbeing, in reply to additional queries, claimed: “We are examining requests for this item and approving when medically vital. We now have to hold out for it to develop into obtainable.”
That seemed like progress, when compared with the before, bureaucratic-sounding assertion about needing to “fully assess” the pump “for coverage and protection conclusions.”
So I contacted Insulet, the Acton-based enterprise that will make the Omnipod 5, and asked if the pump was out there.
An Insulet spokesperson replied: “With a confined distribution network, any health practitioner can write a prescription and any individual that has accessibility and insurance policies protection can get our product. They just have to go through a pharmacy that maybe they’re not currently going as a result of.”
On the same working day I acquired that clarification, Daniel identified as Optum Rx, a prescription drug profit service provider, which is an accepted provider beneath the Salls’ wellbeing care approach. Optum Rx said it had the Omnipod 5 and that it could ship it to them when authorised by Level32Health, Daniel claimed.
When I requested Place32Wellbeing for an rationalization about the original denial, it claimed: “There have been a number of contributing things to this. Because the item is new and according to the producer not extensively accessible but, it was coded in the procedure in the similar way as the Omnipod Dash merchandise (more mature technology gadget), which was free of charge from the company. We typically exclude coverage for products and solutions that are supplied at no price by a manufacturer.”
Bottom line? “We’ve requested Optum Rx to ship the products to the member as shortly as feasible,” Position32Wellnesssaid.
Final Wednesday, it arrived at the Salls’ household.
Daniel and Elizabeth Salls say they expend countless several hours on the cellular phone running the circulation of prescriptions and health-related equipment Cate requirements. It’s a globe packed with entice doors and blind alleys.
I’m confident no damage is supposed, but in some cases mistaken information and facts does get out about what is included and what’s not. Savvy people know to push on.
Customers are typically at a massive disadvantage when working not only with insurers but also professional medical suppliers and suppliers. Often, what they say is confusing and contradictory. Sorting as a result of it all can be exhausting and dispiriting.
At this issue, the Salls know how to persist. But of study course not all people has the time and means to do what the Salls say they routinely do.
A far better, additional simplified program is needed.
Bought a dilemma? Send out your buyer issue to sean.murphy@globe.com. Adhere to him on Twitter @spmurphyboston.
LONDON–(Small business WIRE)–Kilter Finance is delighted to announce that it has entered into a binding settlement to commit $40 million into Most effective Techniques Clinical Companions LLC (“BPMP”).
BPMP will use a sizeable sum of this financial commitment to make a prepared capital contribution to its risk retention team, Used Medico-Authorized Remedies Hazard Retention Group, Inc. (“AMS RRG”), which has lately been assigned a Financial Energy Ranking of A- (Superb) and a Extensive-Expression Issuer Credit history Ranking of “a-” (Superb) by AM Ideal.
The financial investment proceeds will be utilized by BPMP to enhance the statutory surplus of AMS RRG, as perfectly as to accelerate the expansion of its greatest-in-class professional medical specialist liability insurance policy small business and permit it to execute upon other vital strategic initiatives.
Richard Welch, Co-Founder and CEO of BPMP reported, “We are excited about the investment decision from Kilter Finance, who have demonstrated their insurance plan skills and velocity of execution by way of this procedure, and believe that Kilter Finance’s insights and versatility make them a great husband or wife for us as we go on to expand.”
Dan Knipe, Main Investment decision Officer of Kilter Finance, claimed, “We are delighted to be partnering with the BPMP management workforce for an thrilling stage in their corporate improvement. We are deeply impressed by the group’s success and the top quality of their current money companions, some of whom have supported the company for perfectly around a 10 years.”
Charles Lens, Taking care of Director of Kilter Finance, commented, “We have carefully structured our expense to offer the company with the versatility it needs to expand, when enjoyable the prerequisites of all of its key stakeholders, in individual its regulator, the scores businesses and its management crew.”
BMS Capital Advisory served as distinctive fiscal advisor to BPMP and Troutman Pepper served as legal counsel to BPMP. Debevoise & Plimpton LLP served as legal counsel to Kilter Finance.
ABOUT KILTER FINANCE
Kilter Finance is a KKR-backed, insurance policies-targeted specialty finance team. As of January 31, 2022, Kilter Finance has made commitments totalling approximately $200 million to four organizations in both of those the United Kingdom and United States of The united states.
As a lasting funds motor vehicle, Kilter Finance is very first and foremost a solutions-led organization, supplying versatile, bespoke cash answers to its purchasers. It is collateral, framework, territory, forex and tenor agnostic. The Kilter Finance administration crew are specialists in the insurance policy and asset administration sectors. For additional information, be sure to visit www.kilterfinance.com.
KKR, with $459 billion of property under administration as of September 30, 2021, is a top world wide expenditure firm that manages many substitute asset classes, like private equity, credit history and serious assets, with strategic partners that handle hedge cash. For more facts about KKR & Co. Inc. (NYSE: KKR), be sure to stop by KKR’s website at www.kkr.com and on Twitter @KKR_Co.
ABOUT Best Techniques Clinical Partners LLC
Greatest Procedures Healthcare Companions LLC, the keeping organization for AMS RRG and affiliated subsidiaries, operates to supply superior medical risk management services to the businesses nationwide at danger for health-related legal responsibility.
Domiciled in Arizona as a domestic casualty insurance policies company because 2003, AMS RRG delivers superior benefit health-related liability insurance policy and organization risk management methods, with unparalleled services to customers located throughout the United States. AMS RRG’s danger administration contributes to its achievements by offering a exceptional system that engages member medical professionals in initiatives focused on decreasing faults and challenges, with vital objectives of total statements reduction and enhanced functioning profitability. Comprised of professional and dependable health care executives, professional medical leaders, and insurance specialists, the Company’s govt workplaces are found in Florida, New Jersey, Texas, New York and Connecticut. AMS RRG is rated A- (Excellent) by AM Most effective, and A’ (A Prime), Unsurpassed by Demotech.
Duy Hoa Tran, a retired Vietnamese schoolteacher, arrived in Los Angeles in February 2020 to visit his daughter and 2-month-old grandson. Two weeks later, the door closed behind him. To prevent the spread of COVID-19, Vietnam shut its borders. No commercial flights would be allowed into the country for the next 18 months.
Tran’s daughter, An Tran, who has a doctorate in business administration and teaches marketing at the University of La Verne, did what she thought was necessary to ensure medical coverage for her then-65-year-old father during the pandemic. But the only option for a visitor on a tourist visa was travel insurance. In early March 2020, An Tran found and purchased a policy, for about $350 a month, from a company called Seven Corners.
She might as well not have bothered.
The elder Tran had been staying at An’s home in Diamond Bar about a year when he told his daughter he was having trouble seeing out of his right eye. A visit to an ophthalmologist produced a solemn verdict: Tran had severe glaucoma and would quickly go blind unless he got surgery.
Seven Corners gave written preapproval for the procedures recommended by Dr. Brian Chen. To be safe, An Tran called the insurer “many times” to confirm it would cover the expense, but no one she spoke with would give her a definitive answer, she said. Chen, however, assured An that insurance companies typically covered the treatment, which was pretty routine.
On April 19, Tran underwent the first of three eye surgeries to resolve the glaucoma. The surgeries — the last was on July 19 — were successful. And then on Aug. 5, Seven Corners sent An Tran a denial of service letter.
The company’s policy excluded coverage for any “preexisting condition,” by which it meant any condition “whether or not previously manifested, symptomatic, known, diagnosed, treated or disclosed,” the letter said.
An Tran and her father were on the hook for nearly $38,000 in medical bills, although Seven Corners had preauthorized the surgery and she had paid around $6,000 for the insurance over the previous year and a half.
As for the bill, “my dad obviously can’t pay it,” Tran said. His $260 monthly pension from the Vietnamese government isn’t enough even for him to live on in Vietnam, she said.
The surgical procedures Duy Hoa Tran received are quite routine in the United States, said Dr. Davinder Grover, an ophthalmologist in the Dallas area and clinical spokesperson for the American Academy of Ophthalmology.
Medicare would generally pay about a quarter of the $37,896.83 that Tran was billed for the surgeries, Grover said. If Tran’s daughter had known beforehand that insurance wouldn’t cover the procedures, the physician’s practice might have been willing to charge something like $12,000, he said.
The policy An Tran purchased had no deductible and offered coverage of up to $100,000 in medical bills, including COVID-19 care. But travel insurance generally covers only emergency or urgent medical expenses, according to the California state insurance commission, which regulates policies in the state.
Megan Moncrief, chief marketing officer for Squaremouth, which aggregates various companies’ travel insurance plans — including some from Seven Corners — and offers them through its website, said the policy language was not unusual for travel insurance. She noted the policy’s stipulation that it covered some acute conditions only if the patient sought treatment within 24 hours of the initial symptoms.
Moncrief said the fact that Tran did not seek treatment immediately may be the reason his surgeries weren’t covered. (Seven Corners refused all comment on the case.) She acknowledged it was hardly surprising he hadn’t dashed to the doctor at the first sign of discomfort: “I don’t know that I would have done that either, if I just had blurry vision.”
As for Seven Corners’ refusal to pay despite precertification, this is not uncommon, she said. By precertifying, the insurer verifies that a procedure is a covered benefit, but doesn’t guarantee the insurer will cover it for that particular patient.
Travel insurance typically offers little protection for any health problem linked to a preexisting condition, regardless of whether that condition has ever been diagnosed, says Susan Yates, general manager in the U.S. for Falck Global Assistance, an international insurer.
“For visitors to the U.S., especially those who are not permanent residents or citizens, it can be difficult to obtain health insurance,” she said. The Affordable Care Act doesn’t cover tourists, though some resident noncitizens can buy coverage.
“It’s usually better for a visitor to buy travel insurance from their country of origin, but in some countries (Vietnam being one), the insurance market is not developed,” Yates wrote in an email.
Tran had tried unsuccessfully for months to fly home to his town near Ho Chi Minh City, where his wife lives with another grandchild. On 14 occasions, An bought him tickets on regular commercial flights that were subsequently canceled. He was also unable to get a seat on charter flights arranged by the Vietnamese government; those tickets generally were available only through third parties charging up to $10,000.
The eye surgeon, Chen, offered to discuss the case with KHN, but his medical group’s counsel said it had a policy against discussing insurance issues with reporters, even with the patient’s consent.
After KHN approached him to discuss the issue, Chen told An Tran that he was waiving his $8,144 fee for the surgeries. The Acuity Eye Group, where he practices, would not immediately confirm Chen’s offer, but told An Tran it was seeking approvals to waive his fee and all other charges as well.
On Sept. 15, Duy Hoa Tran finally managed to get on a charter flight back to Vietnam. He’s happy to be home, An Tran said.
KHN (Kaiser Health News) is one of the three major operating programs at KFF (Kaiser Family Foundation), an endowed nonprofit organization that provides information on national health issues.
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