Somewhere in Iowa, a teenager with a severe bleeding disorder holds the answer to a nationally debated riddle: How could anyone rack up more than $1 million per month in medical bills?
Iowa’s largest health insurer, Wellmark Blue Cross & Blue Shield, has cited the case as an extreme example of exploding health care costs. Wellmark has said the single member’s bills amplified fast-rising premiums among tens of thousands of other Iowans who buy their own insurance.
The case reportedly contributed to the insurer’s decision to stop selling such policies here next year, which led the state’s other two main carriers to say they probably also will pull out of Iowa's individual insurance market.
The million-dollar anecdote sparked widespread speculation about what type of illness could lead to such colossal medical bills. In public hearings and interviews with reporters, Wellmark leaders have said the customer had an unspecified genetic disorder.
But a company executive shared more details during a recent presentation to the Des Moines Rotary Club. The patient is a teenage boy who has hemophilia, a genetic disorder that prevents the blood from clotting, Wellmark Executive Vice President Laura Jackson told more than 100 people who attended the Rotary meeting. She did not name him or give his hometown.
Hemophilia can lead to uncontrolled bleeding, including internal hemorrhages that can cause severe joint pain, bruising and even death. It is commonly treated with concentrated solutions of “factors,” which are proteins that help the blood form clots and heal cuts. The life-saving treatments are extremely expensive to produce. Most patients require a few infusions per week. Some require several per day.
The Centers for Disease Control and Prevention estimates 20,000 Americans have hemophilia, which mainly affects boys and men. Up to 20% of patients develop an antibody that makes their systems resist the standard treatment, the federal agency reports on its website. “Treatment of bleeding episodes becomes extremely difficult, and the cost of care … can skyrocket because more clotting factor or a different type of clotting factor is needed,” the agency says.
Katie Verb, director of policy and government relations for the Hemophilia Federation of America, said that in general, hemophilia care costs $250,000 to $1 million per year. At the high end of that range would be patients who need multiple infusions of different types of clotting factor per day. "A million dollars per month is something we've never heard of," she said.
Verb said she couldn't speculate on what related health problems the Iowa patient might be experiencing. "Without knowing all the facts, it's hard pin this on one disorder," she said.
Michelle Rice, a vice president for the National Hemophilia Foundation, said she could imagine how aggressive treatment of a complicated case could lead to such costs. Rice said that when a patient's immune system rejects the standard treatment, doctors sometimes try to overwhelm the body's response. "You're giving the patient massive amounts of factor on a daily basis. You're basically trying to get the body used to the factor, so it no longer rejects it," she said.
Rice, who lives in Indiana, has a mild form of hemophilia that rarely needs treatment. She has two sons with severe forms, which cost about $700,000 per year to treat. She said the shots must go directly into veins, an unpleasant experience. No one would seek to use more of the factor treatment than necessary, she said. "As patients, we are very aware of how expensive we are, and I would tell you that most patients try to be very good stewards of health care dollars," she said.
Wellmark leaders have said they don't fault the patient or his family for the cost of his care, and they're glad it's helping to keep him alive. But they said the cost needs to be spread across a bigger pool than the 30,000 Iowans who are in the individual-insurance pool he's in.
If Wellmark follows through on its plan to stop selling individual health insurance policies, the mystery patient's family presumably would shop for another policy. National health-insurance experts have theorized that the prospect of winding up with that extremely expensive Iowan might have helped scare off Aetna and Medica, the other two carriers offering individual health insurance in most of the state. Aetna has said it won't sell such policies in Iowa next year. Medica has said it probably won't.
"Everyone is trying to avoid the $12 million-man," Duke University research associate David Anderson told the publication PolitiFact. "Because whoever catches him basically can’t make money."
Iowa Insurance Commissioner Doug Ommen said that's an oversimplification. Ommen said the pool of Iowans buying individual insurance — as opposed to policies provided by employers or public programs — includes too few young, healthy customers and too many people with chronic medical problems. "We have a concentration of people with persistent health conditions. It's not just one person," Ommen told The Register Wednesday.
Ommen has been urging Congress to pass new rules that would encourage insurers to stay in markets such as Iowa. Among them could be a reinsurance program that helps carriers shoulder unexpected costs and a reinvigorated high-risk pool, which could take on patients who have chronic, hard-to-treat conditions.
Iowa still has a high-risk pool it created in 1986. That program has shrunk from 3,000 to 300 members since the Affordable Care Act forced private insurers to cover people with pre-existing health problems. But if no private carriers offer individual coverage for next year, the mystery Wellmark customer probably could qualify for coverage in the state high-risk pool, the program's administrator told The Register last week.
Premiums for policies from the high-risk pool are generally 150% of premiums for private coverage. Although that's hundreds of dollars extra per month, it wouldn't come anywhere near what the pool would have to pay for treatment for the unidentified hemophilia patient.
Much of the money would come from a special fee levied on insurance carriers, including Wellmark. But the carriers could deduct those fees from future state tax payments, meaning the state would effectively wind up footing much of the bill, Ommen said.
Verb, the Hemophilia Federation expert, said the Affordable Care Act has been a big help to people with the condition. Before the law, also known as Obamacare, health insurers routinely excluded people with hemophilia or imposed lifetime limits on how much their policies would pay for care. Even if such limits were as high as $1 million, many people with hemophilia would hit them within a few years, she said.
The Hemophilia Federation also opposes putting people with the disease back into state high-risk pools. Such pools had high premiums, were routinely underfunded, and often didn't cover everything needed to treat the disease. "It isn't really insurance," Verb said.