Karen Fairbank has cataracts and is scheduled for surgery in March at UCLA's Jules Stein Eye Institute. With her high-deductible Blue Shield of California policy, she was facing about $3,000 in out-of-pocket expenses.
But with a contract dispute between Blue Shield and UCLA showing no sign of resolution, Fairbank, 59, of Pacific Palisades found herself looking at more than $12,000 in costs because the insurer said it wouldn't cover the operation.
Her situation is yet another illustration of the sad state of healthcare in this country as patients get caught in the crossfire of huge companies and institutions squabbling over how much money should be changing hands — and ultimately, how much each side should be able to pocket.
FOR THE RECORD: Blue Shield:
The headline on an earlier version of this online article said there was a contract dispute between Blue Cross and UCLA. The insurer involved is Blue Shield, as stated in the story.
In this latest dispute, Blue Shield and the university have failed to come to terms over reimbursement rates for treatment at Ronald Reagan UCLA Medical Center in Westwood and the nearby Santa Monica-UCLA Medical Center and Orthopaedic Hospital.
Blue Shield says the amount it has to pay for members' healthcare has nearly doubled over the last five years, while UCLA says it just wants fair compensation amid rising medical costs.
"Right now, things are at a standstill," acknowledged Steve Shivinsky, a Blue Shield spokesman. "I don't think we're talking at all."
And stuck in the middle are people like Fairbank, who told me she's paid about $200,000 in premiums to Blue Shield over the last 25 years.
She said that while she could probably get treated elsewhere and be covered by Blue Shield, her doctor instructed her to use the UCLA facility because it's the best place for cataract surgery.
"I'm supposed to go against my doctor's recommendation?" Fairbank asked. "The expertise I need is at Jules Stein and I've already spent time and money getting prepared for the surgery there."
She added that "one of the reasons that I originally signed up with Blue Shield was to be able to avail myself and my kids of the UCLA hospitals and doctors."
Health insurance is one of those things you don't really worry about until you need it. And when you do, you don't want any hassles.
Yet all too often, people find themselves running an obstacle course of corporate bureaucracy when they're at their most vulnerable, or discover, as Fairbank has, that the coverage they've faithfully purchased for decades isn't as comprehensive as they'd been led to believe.
"I feel helpless," she said. "And furious."
She should. Americans already pay about twice as much for healthcare as people in Britain, Germany, France and other developed nations that guarantee affordable health insurance for everyone. Yet our life spans are shorter and infant mortality rate higher.
And there's no sign that our for-profit, employment-based health insurance system is capable of reversing that trend, let alone extending coverage to the 50 million or so people nationwide who lack insurance.
It's a complicated equation, with lots of moving parts. But the spat between Blue Shield and UCLA spotlights a key aspect of the problem: Determining a fair price for treatment.
"We're trying to reach a reasonable agreement for rates that are affordable for our members," Blue Shield's Shivinsky said.
He said UCLA's hospitals already enjoy a profit margin of about 17%. "We're saying to them, 'How much more do you need?' "
Asked to respond, a spokesman for the UCLA Health System confirmed the profit figure but said by email that "despite what Blue Shield is portraying to the public, the facts are that Blue Shield terminated its contracts with UCLA doctors and hospitals."
"UCLA doctors and hospitals would be delighted to continue caring for Blue Shield members without a change to the previous contract terms for the next six months," the statement said, "and then, as we have done with all other payers, negotiate a going forward arrangement with Blue Shield in collaboration with UC Health."
I understand the perspective of both sides. Blue Shield wants to keep costs down for members and thus is seeking to limit how much the company has to pay for medical treatment. UCLA wants to negotiate rates that it believes are commensurate with the quality of care it provides.
That sort of dynamic might work fine if we were talking about Wal-Mart, say, haggling with its suppliers. But this isn't about the cost of bed sheets or cookware. This is about people's lives.
In that sense, healthcare isn't a product you want to leave exposed to the cold winds of the marketplace. It's a product, like clean water or safe food, that requires a firm regulatory hand to ensure the best interests of society are met.
Fairbank is lucky. She found out this week that Blue Shield had approved her request to cover her cataract surgery to ensure "continuity of care."
"But I still worry about all those others who can't get treated," Fairbank said.
Exactly. Because, first and foremost, healthcare is about treating patients.
Too often, that fundamental truth gets overlooked.
David Lazarus' column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5. Send your tips or feedback to firstname.lastname@example.org.