Insurers try to figure out next moves

Print Friendly and PDF By: Andy Miller Published: Nov 15, 2013

Officials in the state’s insurance industry were busy Friday puzzling over what exactly President Obama’s decision on canceled policies means for them and their customers.

“This is going to be a very confusing customer experience,’’ said Graham Thompson, executive director of the Georgia Association of Health Plans, an industry trade group.

Obama’s decision, announced Thursday, lets insurers continue offering individual plans for another year, even if they don’t meet the Affordable Care Act’s minimum benefits.

Ralph Hudgens

Ralph Hudgens

In Georgia, to a large extent, this option is already available: Most insurers here are allowing individual consumers to renew their plan before Jan. 1 and avoid the ACA’s benefits requirements.

Thompson said the industry expects to learn much more about the White House’s policy shift when federal officials issue rules on the canceled policies, expected soon.

Meanwhile, state Insurance Commissioner Ralph Hudgens issued a statement blasting the Obama decision as “nothing more than a political stunt designed to remove the growing momentum towards much-needed change and shift the blame from the president’s flawed health care reform.”

Under the policy shift, the Obama administration is not requiring insurers or state insurance commissioners to extend the existing plans, but instead is letting them offer an additional year of coverage. It’s up to the insurers and state officials to allow the extensions.

Also, insurers must notify policyholders of the difference in benefits between their policies and the ACA plans available on the insurance exchanges. And the companies must inform people that additional policies are available on the exchanges and that subsidies may be available to those who qualify.

The exchanges are geared to offer coverage to people who currently are uninsured and those who buy policies as individuals.

Thompson, the industry official, said insurance executives have questions on what information should be sent to policyholders, including those who have already renewed their plans.

“We want to make sure our members have accurate information,’’ Thompson told GHN on Friday.

Commissioner Hudgens has estimated that 400,000 people in the state currently have individual coverage that doesn’t meet the ACA requirements.

Individual policies often have major gaps in benefits and big out-of-pocket costs, but many plans offer lower costs, appealing to some consumers.

When he spoke about the Affordable Care Act during his political campaigns, Obama promised that people could keep their insurance plans if they wished. Recently, when many Americans received unexpected policy cancellations, the president’s credibility on his signature legislation was undercut, experts said. Last week, the president apologized for the confusion.

Making his announcement Thursday, Obama appeared to relent to pressure from the public and his own party, suspending a key requirement of the ACA to fulfill his campaign pledge.

Cindy Zeldin, executive director of Georgians for a Healthy Future, said she understood why Obama felt he needed to act, given the technical problems of healthcare.gov not allowing many consumers to consider their options.

But she also said that “for most people, including large numbers of uninsured Georgians, the plans on the exchange will provide the most value in terms of comprehensive benefits at an affordable price.”

Consumers sticking with an existing individual plan won’t have access to the subsidies and consumer protections available through the exchange, Zeldin added.

Hudgens, a vocal critic of the Affordable Care Act, said in a statement, “While I encourage insurers to offer consumers as many options as permitted, I lack the statutory authority to force insurers to provide the stopgap measure that the president created yesterday. Insurance companies have spent years preparing for Obama’s law, now the president has given them six weeks to temporarily undo its damage.”

Thompson said insurers will not discriminate against people with health conditions in their renewals of policies. But he noted that insurers don’t have much time to change their policy renewal procedures before the Jan. 1 startup of new coverage in the health insurance exchange.

“With 40 days left, the president wants to change the rules,’’ Thompson said. “He said he fumbled the ball. Now he’s punted the ball.’’

Thompson said Hudgens, in contrast, had given insurers plenty of time to execute early renewals in Georgia.

In his statement Friday, Hudgens said, “The president needs to make substantive reforms, not engage in political half-measures like we witnessed yesterday. I urge Democrats and Republicans in Washington to come together and work on market-based health care reforms that will work for Georgia.’’

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