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Care plan gap seen for many workers

Low-wage earners who can't afford company benefit ineligible for aid

Sandy O'Brien has chronic back pain, but no insurance, and is often immobilized on the sofa in her Hopedale apartment. (DAVID KAMERMAN/GLOBE STAFF)

As many as 30,000 low-wage workers face a Catch-22 that could leave them uninsured, despite the state's new healthcare initiative.

They can't afford the insurance offered by their employers, yet they aren't eligible for state subsidies because their employer offers coverage.

"It's totally and completely unfair," said Sandy O'Brien, 53, who hasn't had insurance for years.

After being out for two days last week with severe back spasms, O'Brien dragged herself back to her counter job at Dunkin' Donuts in Milford, where she is on her feet all day. Without insurance, she doesn't have the money to see a doctor for treatment or to get the doctor's note that Dunkin' Donuts requires for an absence of more than two days.

Dunkin' Donuts offers her insurance, but on a yearly income of about $15,000, she can't afford the monthly premium of $98. She sees other people with equally low wages signing up for the new state- subsidized insurance plans. But she's not eligible.

The state law requiring every adult to have coverage by July 1 is structured to encourage work-based insurance. Anyone who is offered coverage through work, no matter how expensive, is excluded from the state plans.

"For poor people in my situation, the new insurance law is really a joke," O'Brien said.

She is among the approximately 60,000 people who will be excluded from the state requirement to obtain insurance because coverage isn't affordable for them. But that brings O'Brien no relief, because she will remain uninsured.

Not having insurance, she says, "is a very, very bad problem. When my back went out months ago, I went to four different doctors' offices, and none of them would see me because I didn't have the money. I started crying. I'd been out of work for two weeks at that point, and I had no money."

The state needs to find a way to help insure people like O'Brien, said Celia Wcislo, a labor organizer who is on the Commonwealth Health Insurance Connector Authority , which oversees implementation of the new law.

"There are many working low-income people who have access to insurance but can't afford it," said Wcislo, assistant division director of labor union 1199 SEIU. "If we're trying to make it universal, it's our responsibility to figure out how to make insurance affordable for them."

The law provides a mechanism to do that. It permits the Connector Authority board to admit low-income workers like O'Brien into the subsidized program as long as their employers send the state the money that they would have paid toward those workers' premiums. But it leaves the decision up to the authority.

Based on her income, O'Brien would probably qualify for free coverage in Commonwealth Care, the new state program that offers subsidies on a sliding scale based on income. But even with her employer's contribution, the state cost for insurance would rise, because the state would be picking up her share of the cost. Growth in spending remains a big cloud over the long-term future of the healthcare initiative.

"We're looking at the financing" of including more people than the state has already budgeted for, said Jon Kingsdale, executive director of the authority's board. "There are lots of demands for additional spending. If we have any extra money, we could spend it. But it's premature."

In addition to the 30,000 people like O'Brien, there are more than 4,000 self-employed workers who are prohibited from joining the more affordable Commonwealth Care because of another quirk. They meet the income guidelines for the program, earning less than $30,636 a year, but are excluded because they have insurance through an older state program that provides smaller subsidies.

That program, the Insurance Partnership, pays a portion of the premium for private insurance, but leaves some low-income, self-employed people facing insurance bills of $300 or $400 a month. Under the new insurance law, to qualify for Commonwealth Care and its premiums of zero to $180 a month, they would have to go without insurance for six months.

"They're offering something that's more affordable, but they're telling me I can't have it unless I drop my insurance and stay off it for six months," said Margot Sharff, 39, a self-employed garden designer who makes about $17,000 a year. "That's a risk," she said, but one she is considering, even though it seems counter to the intent of the new law.

Sharff has benefited from the Insurance Partnership for six years. But with premiums rising, she said insurance is no longer afford able even with the state paying half. Getting into Commonwealth Care would cut her premiums drastically.

For the state, in addition to the increased cost, there is also the question of how employers would respond to a policy change that lets more low-wage workers into Commonwealth Care. Jonathan Gruber, an MIT economics professor who sits on the connector board, said some employers with many low-wage workers might try to shift more costs to the state by requiring workers to pay a higher share of premiums, thus making coverage unaffordable and pushing more employees into Commonwealth Care.

Others suggest that leaving the policy as it is, instead of allowing people like O'Brien in, could encourage some cash-strapped employers to drop insurance to make all their low-income employees eligible for the state plan.

Connector Authority board member Dolores Mitchell cautioned against quick changes.

"There are a lot of people for whom the connector insurance is less expensive than that from their employer," said Mitchell, who is also executive director of the Group Insurance Commission, which oversees health coverage for state workers. "This is a Pandora's box. Before we lift the lid, we should have an informed discussion about what the implications are."

Alice Dembner can be reached at Dembner@globe.com.

(Correction: Because of a reporting error, a Page One story Saturday about gaps in insurance coverage incorrectly described the frequency of the premium Sandy O'Brien would have to pay to purchase insurance through her employer. The premium is $98 a week.)

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