Harbage projected that with fewer employers offering coverage each year, the number of Californians to whom no insurer will sell policies may grow to 1 million by 2010.
"There are hundreds of thousands of people in California who can't get coverage because the individual health market is broken," Harbage said. "You're trying to fight a forest fire with a garden hose."
Stratton said the most inventive states have found ways to control the costs in their high-risk pools by careful management of chronic ailments. He said in 2002, when Indiana arranged to buy drugs for hemophiliacs at the lower prices available to the federal government, the cost of caring for 54 patients with the blood disease dropped from $19 million to $9 million.
To fix California's pool, the Legislature this year proposed placing a $1 monthly per customer fee on insurers that sell policies directly to customers. The money would have allowed the pool to eliminate the annual cap on benefits, lower premiums and increase enrollment.
Cliff Allenby, the chairman of the board that oversees the pool, told Schwarzenegger in a letter that the measure, AB 2, would "ameliorate the dysfunction" in the individual insurance market.
But in his veto message, Schwarzenegger said the fee would be passed on to customers and thus "only exacerbates their burden."
Dave Dunlap's problems have grown since he was diagnosed with Hepatitis C in 2003. Dunlap, a 54-year-old from Pine Mountain Club, about 60 miles north of Los Angeles, said the disease weakened him so much that he was in two traffic accidents and had to stop driving his 18-wheeler.
Cirrhosis caused by the infection is now in the most advanced stage, according his medical records.
His wife, Susan, said his liver has broken down so much that sometimes she can smell the odor of his body discharging toxins through his skin.
"I suppose in different phases it is controllable, but not when you're at the end," she said. "My husband is dying."
She said a liver transplant and a year of drugs to prevent his body from rejecting the new organ would cost more than $350,000.
The Dunlaps said they had never heard of the state's high risk pool, but given its premiums and benefit cap, it would be of little use to them.
"We couldn't afford it anyway," Susan Dunlap said. "I sell real estate, and obviously real estate isn't selling."
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Jordan.rau@latimes.com
