Report Finds Fault With Health Insurance

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"The affordability of insurance coverage can't be measured solely in terms of the cost of the premiums," Pryor added. "For middle-income people, a combination of high deductibles and co-payments often resulted in unaffordable health insurance."

For low-income people, such policies created unmanageable financial burdens, Pryor said. And for people with high incomes, she added, "annual caps on coverage could leave them with enormous debts if they became seriously ill."

For most people interviewed, high-deductible plans were all they could afford, Pryor said. "These complex, cost-sharing arrangements have created an insurance system that is so complicated that it is almost impossible to understand," she said. "People often become vulnerable to deceptive marketing practices."

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In addition, when people filed claims, they couldn't find out what was covered or why claims were denied, Pryor said. "Often claims were denied because of fine-print clauses or procedural requirements," she said.

Pryor's group suggests several changes to help correct these problems.

There should be standards that define comprehensive, affordable insurance. These standards should include the range of benefits covered and the out-of-pocket expenses for which consumers are liable.

Insurance companies should also provide consumers with clear information that allows them to make informed decisions. In addition, states should oversee requests by insurers for premium increases and have public hearings on these requests. Furthermore, public/private partnerships are needed to share the costs of insurance coverage.

The report is not without its critics, and they divide along political lines.

"This is kind of pie in the sky," said Devon Herrick, a senior fellow at the National Center for Policy Analysis, a conservative think tank. "It's like saying that everyone should have a Cadillac health plan, but at Chevrolet prices. The idea that insurance companies should have to insure everyone, even those with existing health problems, is unrealistic."

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