The California Health IOU Project is a collaborative effort, based at Health Access, to protect consumers from underinsurance and medical debt by:
- Monitoring and working with hospitals and regulatory agencies to ensure compliance with California's Hospital Fair Pricing Act of 2006 (AB774, Chan), which created first-in-the-nation consumer pricing protections.
- Advocating for additional consumer protections, such as minimum standards for health insurance and an end to price gouging by Emergency Room doctors.
- Education and training of public and private agencies, advocacy groups and the public to ensure that Californians know they have a legal right to fair hospital prices.
Typically, an uninsured or underinsured person who goes to a hospital is charged 3-5 times more than a big insurer would pay for exactly the same care.
This is because public and private insurers negotiate prices with hospitals and doctors and, because of their market power, obtain large discounts off the full price, in exchange for patient referrals.
The uninsured and underinsured, on the other hand, do not have the same market power and are charged the undiscounted rate for medical care.
Faced with shrinking health coverage and growing costs, many Californians either go without health coverage or purchase bare-bones coverage, often marketed as “catastrophic” coverage, in an effort to protect themselves.
These Californians are at risk of buying coverage that turns out not be worth the premiums. Many low-cost insurance plans are marketed as financial protection in case of major medical needs, but have such extreme gaps in coverage that consumers are effectively paying to be uninsured.
For example, plans that are marketed as "catastrophic" coverage, but which only pay for care delivered on an inpatient basis, even though 80% of medical procedures, including surgery, chemotherapy and dialysis, are now done in outpatient settings.
Other forms of junk insurance include plans that do not cover hospital care, or that cover only a tiny fraction of the cost of hospital care, which can easily run to $5,000 a day.
IOU project partners work to ensure that:
- uninsured and underinsured patients do not pay more for medical care than everyone else does,
- consumers are given full and accurate pricing information,
- the health insurance plans that consumers buy have value, and,
- consumers can know that value when they purchase the plan