Cover Me

Kathern Cathey thought she had an insurance policy that would save her life. Not exactly.

"Last night I had a bad night," Kathern Cathey says. "A real bad night."

The grape-sized tumor on her pancreas was causing even more pain than usual, so she chased the Vicodin she's been taking with a pill from the bottle of morphine she just had filled. She waited for the pain to subside. And waited. In the end, she just cried herself to sleep, as she's been doing for about a month now.

The problem started in April. She was plagued by stomach problems, but when she went to the hospital, she says, doctors couldn't find anything wrong. They just sent her back to her apartment in southwest Houston with a prescription for pain pills.

Cinergy's "member services" number doesn't appear to provide good service for its members.
Daniel Kramer
Cinergy's "member services" number doesn't appear to provide good service for its members.
While she waits to hear if she'll get the surgery she needs, Kathern Cathey relies on painkillers to make it through.
Daniel Kramer
While she waits to hear if she'll get the surgery she needs, Kathern Cathey relies on painkillers to make it through.

By this time, the 52-year-old had been without insurance for months. Cathey works construction, taking jobs here and there, for a few weeks at a time, with long gaps in between. She says she never had major medical problems before, so she simply did not maintain consistent coverage. But after that April visit, and the hospital bills for "nothing," she realized she had better find a policy.

She found the solution one night, flipping around the television — an infomercial for something called Cinergy Health.

"If you have no healthcare coverage, do you really want to gamble with your health?" asked the host, who never got around to introducing himself. "Are you one of 47 million Americans without health insurance? Have you been putting it off because you thought it was too expensive, or couldn't qualify?...Cinergy Health can offer you significant health coverage at a reasonable price."

Significant health coverage. It can really make an uninsured person's ears perk up. And then the nameless host was suddenly joined by a woman.

"Joining me today to speak on this very important subject is health industry expert Alessana Fordin, who is a licensed mental health counselor," the host said. Apparently, he was too excited about Cinergy's insurance product to explain just how exactly this woman was a "health industry expert." And he skipped over the part where this sage just happened to have an office not too far from Cinergy's headquarters in suburban Miami. But maybe her proximity to Cinergy was more a matter of serendipity than convenience.

Fordin laid out the stark reality: People who are uninsured are more likely to delay or forego standard medical care, which jeopardizes their health in the long run.

"Being uninsured makes one more likely to be hospitalized for avoidable conditions, and of course the uninsured are least able to afford a hospital stay," Fordin said. And then if you're spending all your money on medical bills, she said, how can you afford food and housing? You might go bankrupt.

Cue the "actor portrayals" — Cinergy customers who are so happy they and their children can go to a doctor. They aren't eating dog food and they have a roof over their heads.

Then, nearly eight minutes into the spiel, The Man With No Name clarifies that this is "a limited medical plan" designed to meet "most of your routine and predictable needs." But it also covers 80 percent of the cost of surgery, and the premiums are about half of most major medical plans.

It was like he was speaking directly to Cathey, who picked up the phone and got herself a policy. Two weeks later, when she wound up at the hospital again, doctors found the tumor they had missed the first time around. She was pointed to MD Anderson, St. Luke's or Methodist. But everything was all right now, because she had her Cinergy card.

Or so she thought. She soon learned that covering surgical costs didn't mean much if your hospital costs aren't covered. She says Methodist didn't accept her insurance, and the other hospitals wanted thousands up front. Now she finally knew what that guy from the infomercial meant when he said "limited medical plan."

While some insurance industry watchdogs believe the narrow scope of limited insurance plans does not justify the premiums, the real problem appears to be not the plans themselves, but the way they're marketed.

Cinergy does not appear to be any better or worse than the many other marketers of limited insurance plans; its marketing strategy is just about the same. And it appears that this marketing is aimed at, or is especially appealing to, people who can't afford (or think they can't afford) health insurance. Like the rent-to-own or payday-loan industries, these types of insurance agencies seem to make their money off the most vulnerable segments of the population (see "Cover Me: Apply Heat").

And because most people believe that the best way to obtain a decent policy is through group insurance, insurance agencies like Cinergy say that the low cost of their policies is made possible through the buying power of certain consumer advocacy associations. However, these associations appear to only be marketing tools that create a patina of legitimacy; they are dummy corporations that only exist on paper, and seem to serve no other function than to offer a logo for an agency to slap on its Web site.

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