Couple urges closing gap in Medicare coverage for the disabled
LINCOLN — Because of a gap in state law concerning Medicare, Steve Kay took a job in North Dakota — 600 miles from his home in North Platte — so his wife could have adequate coverage to treat her multiple sclerosis.
Now, he and his wife, Jean, are calling on state lawmakers to close the gap, as is the case in at least 34 other states.
“I just don’t want other people to go through similar situations,” Steve, a retired attorney, said. “Our neighbors have done this years ago, and I think Nebraska should do it, too.”
This story begins two decades ago, when Jean Kay, a nurse, was diagnosed with MS. Slowly, her muscles weakened from the disease, forcing Jean to take less strenuous jobs and eventually go on disability in 2016.
That’s when they discovered the gap. In Nebraska, unlike in many other states, when a disabled person goes on Medicare before age 65, that person cannot obtain supplemental insurance coverage because insurance companies aren’t required to provide it. Such “Medigap” supplements pay about 20% of total medical costs.
This can be an economically crippling gap, according to the Kays, especially when a loved one faces possible hospitalization and expensive medications to treat diseases such as MS or kidney failure.
The couple’s co-pay for one MS medication alone amounts to $7,000 a year. That, plus expenses for pricey COBRA insurance coverage or a second household in North Dakota, threatened their retirement savings.
The couple had relied on Jean’s health insurance coverage as a nurse because her husband was a self-employed lawyer. For a while, after Jean was no longer able to work, they purchased COBRA insurance, a state program for people who lose their health insurance, but it cost $1,400 a month.
So in 2018, they decided that Steve needed to close his law practice and find a job that provided health insurance. He applied for several jobs in Nebraska, including at Menards and Walmart. But his search finally landed him a federal job in Fargo, North Dakota — a 10-hour drive from North Platte.
While that handled their medical costs, it meant extra expenses for an apartment in Fargo. And with her husband gone, Jean, who now walks with the help of a cane or a walker, had to hire help to manage their home.
“We called each other daily — morning, noon and night,” she said. “This reassured him that I had not fallen and would not be unassisted for hours.”
The Kays’ problem was eventually solved last year when Jean turned 65, which meant she could obtain a supplemental insurance plan that costs about $140 a month and covers what Medicare doesn’t.
But the Kays didn’t stop there. After being unable to find another state senator who would take up their cause, Steve reached out to State Sen. Steve Lathrop of Omaha, whose father knew Steve’s father.
Lathrop this year introduced Legislative Bill 1190, which would allow persons under the age of 65 who are on Medicare to be able to purchase a supplemental insurance policy. The bill would require insurance companies to provide such policies at a cost not to exceed what is charged to persons 65 and over.
The bill would impact as many as 45,000 Nebraskans younger than 65 who are on disability, though many of those could have low enough incomes to qualify for government assistance through Medicaid.
LB 1190, Lathrop said, would protect families such as the Kays, who earn too much to qualify for Medicaid but would be hard-pressed to pay the out-of-pocket medical costs covered by supplemental policies.
“I feel like it’s an issue of equity and justice,” Steve Kay said.
A proposed amendment to the bill would include those people who suffer from end-stage renal failure and who are on kidney dialysis or have had a kidney transplant. That is a very small group, perhaps less than 600 in Nebraska.
Some representatives of the insurance industry opposed the bill during a recent public hearing before the Legislature’s Banking, Commerce and Insurance Committee.
Those representatives, according to Unicameral Update, said that providing supplemental coverage for Medicare recipients under age 65 would increase overall premiums for such Medigap policies. April Ayres of Mutual of Omaha said claims from Medicare recipients who are younger than 65 average six times higher than traditional Medicare recipients.
State Sen. Matt Williams of Gothenburg said he and Lathrop, along with representatives of the insurance industry, will meet this summer to “find some way to do this.”
“This is not a big segment of the population, but if you’re in that group, this can just be financially devastating,” Williams said.