Jeff and Kareen King received a $160,000 hospital bill a few weeks after Jeff had a cardiac rehab procedure.
As the number of people enrolling in Medicare supplement plans offered by Allstate has spiked in recent years
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Jeff and Kareen King received a $160,000 hospital bill a few weeks after Jeff had a cardiac rehab procedure.
Bram Sable-Smith/KHN
Kareen King calls it “the ultimate paradox”: The hospital that saved her husband’s Jeff’s heart also broke it.
What happened Jeff King, of Lawrence, Kan., needs to restore his heart rate to normal with a procedure called ablation — sooner or later, his doctor said. Jeff asked the hospital for a cost estimate, but said he received no response ahead of his scheduled January 2021 surgery at Stormont Vail Health in Topeka, Kan.
The real pain came when the bill was mailed a few weeks later. The kings, who were uninsured at the time, had to shoulder most of the cost.
King Jeff63, Lawrence, Kan.
Approximate medical debt: $160,000
Medical problem: remove the heart
Jeff and Kareen King received a bill for $160,000 a few weeks after Jeff had a cardiac rehab procedure.
Instead of signing up for traditional health insurance, The kings joined what is known as a “medical cost-sharing plan” with a company called Sedera, which describes its service as “a refreshing non-insurance approach to management manage large and unexpected health care costs.” With this alternative to health insurance, members agree to share each other’s costs. Plans are often based on beliefs and have become popular In recent years because they can be cheaper than traditional insurance — Kings says their plan costs $534 a month, plus $118 a month to join a Direct primary care medical practice.
But the plan to share provide less protection than insurance and comes with terms. The Kings said their plan didn’t fully cover pre-existing conditions like Jeff’s heart disease during the first two years of coverage — and he needed surgery after 16 months.
In a statement, a Sedera spokesperson said it is important for members to understand the cost-sharing model and membership principles. “Sedera members have read and agreed to these before joining,” the statement read.
The kings researched all kinds of health insurance during their 42 years of marriage. Jeff’s work as a missionary minister in his hometown of Osage City, Kan., almost never provides coverage for the couple or their five children, all of whom are adults. The exception occurred during Jeff most recently led a church, starting in 2015. Kareen remembers feeling “unworthy” of the $1,800 a month that the church was paying for their insurance.
“We certainly never came up with those premiums ourselves,” she recalls.
But Jeff decided to leave that job in 2018. He said he felt compelled because of differences with some of his parishioners over the eternal damnation (“As a loving parent, I can never punish my kids forever”) and same-sex marriage (“May God be so much more perfect than we are”).
After Jeff stepped down, the Kings briefly purchased insurance through the Affordable Care Act marketplace, but later dropped it because they were ineligible for benefits and felt inadequate. afford to pay.
That’s when they joined the Sedera plan. They knew the availability clause was a gamble, but the medication had controlled Jeff’s heart condition for years, and they didn’t expect he would need medical procedures to fix it.
What’s broken: With no employer-sponsored insurance or federal subsidies to help fund their coverage, the Kings felt excluded from traditional insurance. But being uninsured leaves them with hospital bills that the average patient would never see.
Hospital costs are often understood by health economists as bear some similarities to reality price is usually paid. Instead, they are like an opening shot in high-risk negotiations between hospitals trying to get as much money as possible to provide care and insurance companies trying to Pay as little as possible.
But patients lack the bargaining power of large insurers, which can cover hundreds of thousands of patients in any hospital watershed. For patients like Jeff, the key solution is through the hospital’s financial assistance program, although even with that help, many patients cannot afford the bills that the patient has to pay. the hospital sent them.
Stormont Vail’s support program ended up taking about $107,000 off Jeff’s original bill. Sedera provided a negotiator to help him negotiate the cost.
Stormont Vail provided $19.5 million in financial assistance during the 2020 tax year and wrote off about $13 million in bad debt, according to tax filings. Net revenue from patient services was $838.7 million.
In addition to providing financial assistance, the hospital also works with high bill patients and offers interest-free payment plans, said Bill Lane, an administrator for Stormont Vail. Lane said the payments are typically around 10% of a person’s monthly income. For some patients, the hospital has a “catastrophic discount” program that puts their balance at 30% of total household income. The hospital also works with a local bank that lends to the patient to pay the bill. And the hospital sometimes sends a patient’s balance to collection agencies.
Lane said he often advises patients to buy traditional insurance. He also said the hospital offers a “patient estimation module” and asks patients to wait to schedule surgery, if possible, if they want an estimate “to make an informed decision”.
What remains: Despite Sedera’s two-year wait to cover pre-existing conditions, the plan offered Jeff $15,000 to help pay his bills. After Jeff paid that amount to the hospital and then negotiated for several months, his final balance was reduced to $37,859.34 by November 2021.
As for his payment plan, Jeff said he was told the hospital would accept no less than $500 per month — the equivalent of an additional mortgage payment for Kings. Jeff estimates it will take the family over six years to pay off that amount.
“I never expected this wouldn’t cost me anything,” Jeff said, “but I didn’t expect it either.”
The kings are pooling funds to pay what they owe the hospital. A few months after Jeff was amputated, they sold their home in Osage City – where they raised 5 children and where Jeff grew up – and bought a smaller home in Lawrence. They had hoped to use that money to build up their retirement account, since Jeff’s decades of pastoral work didn’t include a pension or 401(k).
Instead, the home sale is helping to pay off Jeff’s medical debt. Kareen has a part-time job and the couple also use their life insurance policy.
Jeff started working as a hospice chaplain – for extra income, but especially so the couple would qualify for health insurance. That means less time for his passion project, running a non-profit organization called Transmuto through which he provides spiritual guidance.
In February, Kareen double checked to see if the couple could afford coverage under the Affordable Care Act so that Jeff could return to work full-time for Transmuto. Her Google searches the federal government’s health insurance marketplace (HealthCare.gov) instead of accidentally taking her to websites that sell consumer information to insurance brokers. Speaking to one of those brokers on the phone, she bought what she said she was told was an Aetna plan. But it turned out to be a membership in a cost-sharing plan with company called Jericho Sharereceived more than 160 complaints on the Better Business Bureau website for the past year.
Jericho Share spokesman Mark Hubbard said in a statement that the organization “refunds full refunds in the event of consumer confusion” and is continuing to “evaluate and update the our marketing efforts to increase transparency and awareness.”
Hubbard also said Jericho Share is working with regulators in California and New Hampshire questioned whether the organization met the state’s requirements for a health care sharing set. California is also questioning whether Jericho Share actually received 501(c)(3) nonprofit status from the IRS.
After canceling that plan and getting their money back, the Kings finally signed up for the ACA marketplace plan. Jeff reduced his hours as chaplain, in order to have more time for Transmuto. Overall, the couple feels quite lucky.
“It was tragic for our system,” said Jeff. “It puts a lot of people in a difficult financial position.
KHN (Kaiser Health News) is a national, editorially independent program of KFF (Kaiser Family Foundation).
