Millions may lose health plans

Insurers sending out cancellations despite pledge by Obama

Share with others:


Print Email Read Later

NEW YORK -- The rollout of the Affordable Care Act is leading to the cancellation of hundreds of thousands of health insurance plans nationwide, contradicting President Barack Obama's repeated pledge that people who like their coverage can keep it.

The cancellation notices started to arrive in recent weeks, compounding the political headaches for the White House from the troubled start of its health insurance exchange, the federal website created to give millions of people access to new plans by Jan. 1.

And on Tuesday, the federal official closest to the website apologized for its dysfunction in new sign-ups and asserted things are getting better by the day.

Medicare chief Marilyn Tavenner said it's not the administration but insurers who are responsible for cancellation letters now reaching many of the estimated 14 million people who buy individual policies. And, officials said, people who get cancellation notices will be able to find better replacement plans, in some cases for less.

The cancellations come as a result of the 2010 Patient Protection and Affordable Care Act, which says that health insurance policies that fail to offer added benefits -- such as prescription drug coverage and free preventive care -- can't be sold after this year even if they're cheaper. With the online site expected to face difficulties through November, Americans may have only weeks to find replacement coverage, and many may end up paying higher premiums.

The health care law eliminates "substandard policies that don't provide minimum services," said Jay Carney, a White House spokesman, in response to the cancellations. The "80-plus percent" of Americans with employer plans or covered by government programs are unaffected.

Mr. Obama's oft-repeated pledge was a central selling point of his health care overhaul, aimed at calming consumers who feared being forced to give up policies and doctors they liked as the program expanded coverage to many of the nation's 48 million uninsured.

While it's unclear how many consumers face cancellation of their insurance nationally, some individual carriers have released data.

Florida's Blue Cross and Blue Shield, for instance, said about 300,000 members are affected while California's Blue Shield and Oakland-based Kaiser Permanente will withdraw policies for a combined 280,000. Highmark Health Services of Pittsburgh said 40,000 customers will need to find new plans. CareFirst Blue Cross Blue Shield sent notices to more than 70,000 customers in Maryland, Washington, D.C., and Virginia that their current plans don't comply with the law.

As many as 80 percent of people who don't have a company-hosted plan or insurance through the Medicare or Medicaid government programs may have to find new health coverage, said Robert Laszewski, an insurance-industry consultant in Arlington, Va. About 19 million people are included in this market.

Plans bought before March 23, 2010, when the law known as Obamacare was enacted, can stay in effect under a "grandfather" clause.

The law requires all Americans to be covered next year or pay a penalty. Those who want plans that begin Jan. 1 must enroll by Dec. 15 -- either by mail, phone or the exchanges.

The administration Tuesday said half of eligible adults younger than 34, the group most likely to be uninsured, can find coverage on the federal exchange for $50 a month or less. One million more may qualify for expanded coverage under Medicaid, according to a report by the Department of Health and Human Services.

For Ian Hodge, 63, of Lancaster, Pa., the issue is all about getting the same care from the same doctors. When he learned his policy was canceled his reaction was "surprise and disgust," he said.

Mr. Hodge said he tried 10 times to get information about a new policy Oct. 1, the day the online federal exchange went live. He's still trying to figure out his options, he said in a telephone interview.

"The website is not very clear," he said. "I'm concerned about being able to get affordable health care that's at least as good as what I had previously."

Mr. Hodge and his wife, Sara, who also is 63, paid $1,041.85 a month for a plan offered by Highmark, he said. They like the care, their hospital and the doctors, and they worry they won't be able to keep them under a new plan.

"I had heard the repeated assurances by the president and people who work for him that if you have health insurance, don't worry, you'll be able to keep your health insurance," Mr. Hodge said. "Well, that's clearly not true. I wasn't allowed to keep my health insurance."

Not all consumers will be losers under the new system. Barbara Wynkoop, 62, of Trexlertown, Pa., said she expects to find a cheaper plan on the exchange, thanks to subsidies and new coverage for her cholesterol medication. She pays $278 a month now for a policy that Capital BlueCross of Harrisburg plans to discontinue.

"The chance for me to save money and still have decent coverage -- what my basic needs would be, I'm happy about that," she said by telephone.

Associated Press contributed.



Advertisement
Advertisement
Advertisement

You have 2 remaining free articles this month

Try unlimited digital access

If you are an existing subscriber,
link your account for free access. Start here

You’ve reached the limit of free articles this month.

To continue unlimited reading

If you are an existing subscriber,
link your account for free access. Start here