By: Jane M. Von Bergen
Inquirer Staff Writer

Carolyn Johnson's monthly health-insurance premiums nearly doubled this month, from $313 to $600 - a tough jump for a laid-off legal assistant who lives with her retired father and gets by on unemployment benefits.

In this case, the staggering 92 percent rate increase was not imposed by an insurance company but by the state of Pennsylvania. Johnson's coverage is equivalent to the adultBasic plan provided by the state's Insurance Department, headed by a commissioner who has been active in pushing for sweeping changes to the nation's health-care system.

"You are not going to find me defending this as a good choice," said Insurance Commissioner Joel Ario, who sat next to President Obama at a recent White House conference on insurance.

"Among the horrible choices, this is the least obscene," Ario said, blaming the increase on the rising costs of medical care.

Pennsylvania's adultBasic is a state-run health-insurance program for the unemployed and financially distressed. That's what makes this increase so onerous, said Jonathan Stein, a lawyer with Community Legal Services and a frequent critic of insurance companies.

"Essentially the state and [the nonprofit Independence Blue Cross] are acting like a for-profit insurance company, pricing people who are needy out of insurance," he said.

In February 2007, Johnson, 53, lost her job as a legal assistant. She eventually went on the waiting list for Pennsylvania's subsidized adultBasic plan.

The program, administered in this area by Independence Blue Cross, is partly funded by payments to the state from the four Blue Cross insurance companies that sell policies in Pennsylvania.

Independence Blue Cross paid $61 million last year, of which $36.6 million underwrites the adultBasic program, Independence Blue Cross spokeswoman Elizabeth Williams said.

Under the adultBasic plan, subscribers receive doctors' visits and hospital coverage for $36 a month. Vision, dental, and prescription drugs aren't included. Until March 1 when the premium rose to $600, people on the waiting list - people such as Johnson - used to be able to buy the same coverage for $313 a month until they could be enrolled for $36.

The waiting list for the $36 program now stands at 390,131 - nearly 10 times the 39,180 currently enrolled. The waiting list has doubled in size in a year, Insurance Department spokeswoman Rosanne Placey said.

About 3,000 on the list, including Johnson, bought the equivalent coverage for $313 per month.

"I have high blood pressure, a thyroid condition, and heart problems," said Johnson, who lives in Cheltenham Township.

"I do need my health insurance," she said. "I can't afford it, but I have no choice."

To Ario, the situation with adultBasic illustrates a key point in the current health-care debate: At $36 per month, the pool of subscribers for adultBasic includes the healthy as well as the sick. But at $313 per month, and at the new $600 price, only the sickest feel compelled to subscribe.

"The average expenses [for medical care] for people paying for adultBasic coverage while on the waiting list were more than three times the average expenses for people enrolled in the low-cost adultBasic program," the department wrote in a January letter to subscribers.

The letter noted that for every 100 people who paid $313, 300 people would not be able to be enter the $36 program. Providing medical care for the sickest strained the state's budget for adultBasic.

The adultBasic premium will rise again in July to $629. Out-of-pocket costs are also up significantly.

"The current system forces us into obscene choices," Ario said. It forces regulators to choose among those needing coverage. "And it forces people into the obscene choice: Do they buy health care or put food on the table for their kids?"

Signed by Deputy Insurance Commissioner Peter J. Adams, the January letter to subscribers said the department realized the increases would "create additional burdens for people who ... are already struggling....

"Hopefully, federal health-care reforms will soon make health insurance more affordable to all, including the people ... on the waiting list."