Consumer group says spending caps in national healthcare law will bring relief to people seeking medical care

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It’s a well-known complaint among consumers and healthcare advocates: The soaring cost of medical care is forcing millions of Americans to drain their savings, run up credit card bills, declare bankruptcy or lose their homes to foreclosure.

A report out Tuesday that examines the problem in California says the nation’s year-old healthcare law –- currently under assault by congressional Republicans -- would help protect people in the Golden State from financial catastrophe.

In its study, the consumer group Families USA points out that the law would cap how much people with insurance must spend out of their pockets for healthcare services, starting in 2014.

If the law were to take effect this year, the group says, the caps would be $5,950 for an individual and $11,900 for a family of any size. Low-income people would pay less than higher earners.

More than 1.9 million Californians would exceed the spending caps if they were in place this year, the group reports. That extra spending would surpass the caps by more than $3 billion.

Once the new spending limits are in place in 2014, insurance companies will have to pick up the tab for essential medical services -– including the costs for doctors, hospitals, prescription drugs and emergency care -- after consumers pay their share.

‘These new out-of-pocket caps will protect families from catastrophic medical costs when illness or [an] accident strikes,’ the report states.

The spending caps will apply to health insurance plans sold through new insurance exchanges scheduled to open in 2014 in California and other states. The limits also will apply to new insurance plans sold to individuals and small businesses outside the exchanges.

In addition to the report on California, Families USA produced data for other states. To read the reports, go to http://www.familiesusa.org/resources/publications/reports/health-reform/out-of-pocket-caps-states.html.

-- Duke Helfand