Health Care Industry Forces Family Impoverishment: UCPA Witness Testifies on Access to Health Insurance

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Health Care Industry Forces Family Impoverishment: UCPA Witness Testifies on Access to Health Insurance

On September 19, 1990, UCPA witness Donald Penzenik of South Bend, Indiana, testified before the House Energy and Commerce Subcommittee on Commerce, Consumer Protection, and Competitiveness, chaired by Representative Doug Walgren (PA). At a hearing entitled "Access to Health Insurance: Who is 'Medically Insurable'?" which focused on Representative Walgren's bill, H.R. 2649, Federal Health Insurance Equity Act of 1989, Mr. Penzenik testified about his eight year-old son Michael who has multiple disabilities.

Donald Penzenik opened his testimony by describing his family:

"My name is Donald Penzenik and I live in South Bend, Indiana with my wife, Vickie, and our three children, ages 11, 8 and 4... My wife and I were high school sweethearts and have been married for 15 years. We were both born and raised in the State of Indiana; that is where we have our roots and our extended family.

We have three children: Jeffrey, age 11, Michael, age 8, and Steven, age 4. Michael was born on June 3, 1982. He is a child with multiple disabilities -- his diagnosis is colpocephaly (a brain malformation), hypotonia, seizure disorder, scoliosis, with a communication disorder, mental retardation, and multiple developmental delays -- or in short, cerebral palsy, meaning he cannot walk, talk, dress, toilet, feed or fend for himself. Michael is physically dependent on us for his every need, and probably will be dependent upon us and others for physicial assistance and support throughout his lifetime.

As the head of a household with a child with multiple disabilities, I have learned a great deal more than I ever wanted to know about the health insurance industry and its impact on my family and thousands of families like mine.

While my wife was pregnant with Michael, my employer...was taken over in amerger by another company and I was let go... I didn't opt for the (insurance) conversion policy when the company policy ended ... because there seemed to be better coverage by purchasing a private "family" policy for myself, my wife and my son Jeffrey from Blue Cross-Blue Shield of Indiana, at a premium of $93.60 per month..."

Between June 1982 and April 1986 the following sequence of events forced the Penzenik's to impoverish themselves to qualify for Medicaid coverage for their son.

* Blue-Cross Blue-Shield insurance premiums increased 175 percent in a twelve-month period;

* After being rehired by a prior employer and restored to a prior plan, uncertainty about the future led Mr. Penzenik to retain the Blue-Cross-Blue Shield policy as a personal expense;

* Attempts to add Michael to the family plan were ignored by Blue Cross; instead he was enrolled as an individual policy holder on a separate policy with a $1,000 deductible, with a "1.XVXV benefits code;

* Blue Cross continued the family, minus Michael, in a policy with a $250 deductible with an "XRR benefits code";

* After collecting monthly premiums of $50.43 for Michael and $112.31 for the rest of the family for a period of time, Blue Cross cancelled both policies, stating in a form letter to all policyholders in Indiana they could no longer afford to administer the plan;

* The re-hire by the previous employer and acceptance into the Company's self-insured health benefits followed by a termination created a sense of panic and led to a choice not to purchase a conversion plan for fear the premium would be too high;

* All health insurance coverage lapsed until Mr. …


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