Survey Says Health Care Reform Still Popular as ARM Industry Examine Changes

A majority of Americans still want health care reform despite seeing health care war ads and rowdy town hall meetings that occurred over the summer.

According to an August tracking poll by the Kaiser Family Foundation, 53 percent of those surveyed say tackling health care reform is more important than ever, compared with 42 percent who say the nation cannot afford it right now. The gap between the two viewpoints has narrowed in the last month as criticism and doubts about the plan continued. But 63 percent of those surveyed still are hopeful that reform will happen and 59 percent support a public plan. Even more (80 percent) support an expansion of state run plans such as Medicaid, and 68 percent support coverage mandates on individuals and employers, as well as subsidies for those who can’t afford it.

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“The August health reform wars about hot button issues have definitely made the public more anxious, but they have not caused public support to unravel,” said Drew Altman, president and chief executive of Kaiser.

That may be because more middle class families are growing concerned about losing their health care coverage. According to Kaiser’s July tracking poll, “Health Care and the Middle Class: More Costs and Less Coverage,”  11 million, or 25 percent, of the non-elderly uninsured Americans are members of middle class households with incomes between $44,000 and $88,000 for a family of four. Kaiser said the middle class, and those who consider themselves middle class, account for nearly 70 percent of the growth in the uninsured population between 2004 and 2007.

With nearly 75 percent of middle class Americans relying on employer-sponsored plans for coverage, Kaiser said they have become concerned they also will become uninsured if the recession lingers. The survey showed many already have delayed medical care, even though they have insurance because of higher out-of-pocket costs or outstanding medical debt, the survey showed.

Jerry Greenblatt, president of San Diego-based Inland Capital Services, said the trend is affecting placements and liquidation rates at his collection agency. Although Greenblatt does not track his accounts by income-level, he has noticed a 20 to 30 percent decline in placements and liquidations from one of his larger clients.

“We’re seeing a lot more smaller payments over time, instead of payment in full,” he told insideARM.  

Kaulkin Ginsberg analyst Michael Klozotsky expects the uninsured middle-class population will only grow if health care costs aren’t tamed.

“When you look at the cost of premiums, employer sponsored or private market, you are talking about even upper middle class population in five years not being able to afford health insurance if something doesn’t happen,” Klozotsky said.

Klozotsky said middle-income consumers will either struggle to pay health insurance premiums and get less coverage or forego coverage altogether leaving themselves vulnerable to an adverse event such as an accident or divorce that will put them in a position of not being able to pay certain bills - medical or otherwise.

Collection agency liquidation rates could be impacted in the short term, and the industry could face new regulation designed to help middle-class families from debt collections, Klozotsky said.  But the more educated, financially stable group could bolster future liquidity efforts because the middle class consumer group is more employable and has more assets than less educated or transient workers.

“(Middle-income) folks in some ways are better liquidation targets. They have a greater array of resources to draw from, even when they get into a tight spot,” Klozotsky said.

Greenblatt said in this economic environment it is important for collection agencies to be ready to change their approach. "Some clients only let patients pay over six months.  Sometimes you have to go back and say lets do 12 or 18 months,” he said.

Greenblatt said that flexibility with patients has helped his agency improve an account relationship and collect enough to cover the cost of the contact.

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