Insurance options of last resort -- COBRA conversion coverage, whose name is an acronym for the federal legislation that created it, and publicly subsidized high-risk pools -- are not for everybody because the coverage is insufficient or unaffordable or both.
"If they don't have an opportunity to go to another group and have to go into the individual market, it's a real problem," said Kansas Insurance Commissioner Sandy Praeger, president-elect of the National Assn. of Insurance Commissioners.
That's what worries Garber, the Encino real estate agent. Garber doesn't know what she will do if she loses her coverage, which costs her $596 a month.
"I'm not what I would call every insurer's delight," she said. "I have to be in a group plan or I'm not going to have insurance. It never dawned on me I'd have any problem with this insurance."
Another real estate agent, Hector Aguirre, 39, of Rancho Cucamonga, also thought the group's coverage was safe. He pays nearly $1,000 a month for coverage for himself and his family. His wife has lupus and a daughter needs daily shots of an expensive growth hormone.
"I always thought it had more control and more pull because it's such a huge umbrella under the whole California Assn. of Realtors," Aguirre said.
Realtor Terry Lucoff, 60, of Malibu, who pays a monthly premium of more than $600, fears that if he loses his coverage he will be unable to obtain new coverage that will allow him to continue seeing his regular doctors because he has been diagnosed with a kidney condition.
"If they can do this to the California Realtors association, they can do it to anybody," he said.
The California Assn. of Realtors and its broker, RealCare Insurance Marketing Inc., contend that Blue Shield can't cancel the plan.
"It is against the law for Blue Shield to cherry-pick, i.e., to try to keep only the healthy employees, while cutting off those who need their health insurance most," RealCare alleges in a lawsuit.
Blue Shield says the law allows it to pull the plug if an organization violates the terms of its contract. It says that happened when the real estate group failed to enroll 75% of certain members in the health plan as its contract requires.
But the association and its broker accuse Blue Shield of inventing a way to calculate the enrollment to create a pretext for dumping them and their medical bills. They say that enrollment has been close to 99% for years and that Blue Shield never made an issue of it before.
