In the October 23, 2013 issue of Kaiser Health News, Ann Gorman and Julie Appleby reported that thousands of policyholders who purchased their own policies are being forced to buy a health insurance policy through one of the insurance exchanges formed as a result of the Affordable Care Act, if they can actually get on line to do it. The explanation that is being given for the policy cancellations is that the coverage does not match what the federal government believes should be provided. Which might be the case, but the purchase of the type of coverage required for the individual policy holders means more money for premiums even in the face of the subsidies that are being offered.
The basic problem that is surfacing is the fact the President previously stated that individuals who have their own coverage can keep what they have, well that apparently is not happening.
Florida Blue is terminating 300,000 policies in the state of Florida, which represents approximately 80% of its individually purchased health policies. The reason for cutting loose that many policy holders was the policies did not measure up to the requirements of the Affordable Care Act (ACA). The ACA mandates that individual health policies should provide 10 benefits which are such items as prescription drug coverage, mental health coverage, maternity care and people with pre-existing medical problems cannot be refused.
Kaiser Permanents in California has sent 160,000 cancellations to its individual health care policyholders already with as many as 279,000 anticipated. Ann Gorman and Julie Appleby reports for Kaiser Health News that “Blue Shield of California sent roughly 119,000 cancellation notices out in mid-September, about 60 percent of its individual business. About two-thirds of those policyholders will see rate increases in their new policies, said spokesman Steve Shivinsky.
Like other insurers, the Blue Shield letters let customers know they have to make a decision by Dec. 31 or they will automatically be enrolled in a recommended plan. It is quite apparent to me, it should be to you as well, that insurance providers have seized upon the opportunity to push out the liabilities, meaning the policyholders who are at risk to run up large medical expenses, and keep the low risk, healthy, premium payers.
As an example of this practice, Ms. Gorman and Ms. Appleby again report for Kaiser Health Care News that “Kris Malean, 56, lives outside Seattle, and has a health policy that costs $390 a month with a $2,500 deductible and a $10,000 potential out-of-pocket costs for such things as doctor visits, drug costs or hospital care.
As a replacement, Regence Blue Shield is offering her a plan for $79 more a month with a deductible twice as large as what she pays now, but which limits her potential out-of-pocket costs to $6,250 a year, including the deductible.
“My impression was …there would be a lot more choice, driving some of the rates down,” said Malean, who does not believe she is eligible for a subsidy.”
My only question is this I wonder which insurance company board of directors President Obama will be sitting on when he leaves office.