Switch in the stocking? Health plan sickens some 'Hoos

In late December, when Sandy Ruseau started to make plans for a routine mammogram, she got a nasty surprise: The procedure, which she'd never had to pay for, would now cost her a budget-busting $350.

Ruseau quickly learned the new fee was the result of a switch in her UVA-sponsored health care plan. So what's the problem? Ruseau says she had no idea her policy would be changing. And she believes she is not alone.

Every fall, UVA holds "open enrollment," a period of time during which employees, retirees, and their families can make changes of any kind to their healthcare policies.

This year, however, there was a twist: Anyone who did not specifically request to remain on the current plan a PCP option that entails a $15 co-payment for every office visit– would be switched to a "direct access" plan, which features a lower monthly premium but a much higher deductible in addition to the office co-payments.

The direct access plan also allows subscribers to visit doctors of their choice without a referral from their primary care provider.

UVA health care ombudsman Anne Dawson says that before and during the open enrollment period, November 3 to December 12, the university sent out emails and letters to all policyholders notifying them of the impending change.

In the end, however, a mere 5.8 percent of the 13,000 policyholders ended up with the "direct access" plan. Perhaps even more significant: Only 1.9 percent 247 people actively selected the new plan. The rest were assigned to it by default.

Ruseau says she believes those are the people like her who didn't receive notification by mail or email. Others, she fears, didn't understand the importance of responding.

Dawson has a different take: "Theoretically, folks may have wanted the direct access and knew that their lack of response would result in their being placed into their program of choice," she says.

Ruseau says it's hard to imagine someone choosing direct access.

She says that though the monthly premium for her and her 16-year-old daughter did drop $32– from $570 a month to $538 she will likely pay far more overall if she needs the same medical services she has had in the past few years under the PCP plan.

"I won't be going to the doctor very much this year, that's for sure," says the 53-year-old mother, who suffers from chronic neck problems.

Ruseau's biggest issue with the direct access plan? A $350 deductible and an out-of-pocket patient expense limit of $3,500, bringing a patient's total responsibility under the plan to $3,850. Or, in Ruseau's case, to $7,700 for her and her daughter. That's in addition to the nearly $7,000 in premiums she'll pay for the two of them this year (her husband is on a different company's policy).

"I don't have that kind of money," she says.

Ruseau says her efforts to revert to her previous policy, the standard PCP option offered by UVA, have been unsuccessful.

"They tell me if they let me do it, they'll have to let everyone do it," Ruseau says, "and they say they have to justify that to the IRS."

Dawson explains that UVA's healthcare plans are covered by Section 125 of the IRS code, which allows employees and the employer to deduct healthcare premiums on a pre-tax status. The deduction benefit requires an employer to establish an open enrollment period when changes can be made without a necessary mid-year qualifying event such as a birth, marriage, or death. In accordance with the open enrollment requirements, no changes could be made after 5pm on December 12.

"If we do not consistently apply the outlined rules," she says, "we could cause the health plan to lose its favorable status with the IRS under section 125 and lose the pre-tax benefit."

Ruseau says she's appealing the switch to the university.

"But I'm not just worried about me," she says. "I'm also worried about the employees who don't speak English or who didn't receive notice."

Dawson says Herculean efforts were made to ensure that every employee understood the differences in the two plans. She cites articles in both the Cavalier Daily and Inside UVA magazine, as well as numerous meetings in every department to go over the complicated details of each plan.

In addition, she says, the university contacted by email individuals who had not made a decision, to remind them of the pressing deadline, and had department heads check with every person under their supervision before the deadline.

But Jan Cornell, president of UVA's newly formed staff union, says even with the mailings and meetings, she thinks the new health care option was "unduly hard" to understand, pointing to the lengthy documents policyholders had to sift through. She says she's not surprised: "It's a nightmare with all the benefits," she says, citing the school's retirement plan for employees and reported difficulties reaching benefits representatives when questions arise.

And Ruseau and Cornell both question why the university made the direct access plan the default instead of keeping healthcare subscribers on the original plan.

"I think they were counting on some people not figuring it out," says Ruseau of the university. "It saves them a lot of money."

UVA's health care system is no stranger to financial difficulties. Back in the mid-'90s, the University's health plan administrator, QualChoice, required regular infusions of UVA cash to stay solvent. The efforts to keep QualChoice afloat ended in 2001 when it and its parent company, Blue Ridge Health Alliance, were sold for $12.5 million to Coventry Health Care, parent company of Southern Health.

But Dawson says the recent events have nothing to do with financial difficulties and that making the direct access plan the default choice was actually done out of courtesy. "We didn't want to assume people wanted a greater amount deducted from their paycheck," she says.

And Dawson claims that any implication that the university adopted the new plan to save money is patently false. "We decided to offer the plan at the request of employees who wanted to be able to see specialists without a referral," she says.

Jason Coleman, a manager at the University of Virginia Press, says he initially considered the direct access plan, but eventually his family chose to stay with the original plan. He feels the university did all it could to make employees aware of the change– including sending him numerous emails and having his supervisor remind him.

"I wanted to tell them to stop telling me," he laughs.

And Joe Orsolini, an employee with Medic Five, a UVA ambulance unit, agrees with Coleman.

"There was a lot of information available and telephone numbers to call," he says.

But for Sandy Ruseau, the fact that many people knew about the switch is small consolation, at least until the next open enrollment period when she can switch back.

"If my daughter and I have serious medical problems this year," she says, "my family will be destroyed."

Sandy Ruseau