People Who Buy Own Health Policies Face Big Changes – NY Times Oct 29
As Washington and much of the rest of the nation debate whether President Obama misled Americans when he said that people who like their health plans may keep them, tens of millions of people are finding that their insurance is largely unchanged by the new health care law.
They are the estimated 149 million people who receive health insurance through an employer, according to the Kaiser Family Foundation. While the law has required adjustments to those plans and some prices could rise, generally people who keep their jobs may keep the same coverage. Some exceptions exist.
The story is different for the 10 million to 12 million people who buy insurance on their own. Rules for those policies have changed substantially for 2014.
Insurers are informing many of those people that their old plans have been discontinued and that they must choose new plans at new prices.
About half of those people may qualify for federal subsidies
or Medicaid, according to a recent analysis from the Kaiser Family Foundation. But those who do not are often facing much higher premiums.
The coverage required under the federal health care law is much more generous than many of the plans that had been sold to individuals, and insurers are now pricing these policies to account for many of the older and sicker people they once could turn away but must now cover. Under the new rules, people with pre-existing conditions may not be denied coverage and there are limits on how much prices may vary for people of differing ages.
Some people may find a new policy less expensive than their previous one. That could be because the insurer charged a high premium based on their age or medical condition. That is no longer permitted. And others may have plans that are “grandfathered,” meaning they were in place in 2010 and can be renewed without significant changes.
At Florida Blue, for example, 300,000 people will be notified this year that their coverage is up for renewal, and they will have to select a new plan, either through the new state marketplace or directly with the insurer. Only about 60,000 will be allowed to renew their current policies because they are grandfathered. The rest must choose among the new plans offered by Florida Blue or another insurer.
“There’s always been a lot of churn in the individual market,” said Jon Urbanek, a senior executive at Florida Blue. As a result, most people will be told that they need to change policies when they would typically be asked to renew, he said. “We’re not terminating their coverage,” he said, but people will be asked to change their policies and pay whatever premiums are being charged for that particular plan. “They’re renewing into these qualified health plans.”
About 40,000 people have received letters informing them that their policies end in January, he said, but the bulk of people tend to
renew later in the year.
As part of the law, certain benefits must be included in the new policies. For example, coverage must include maternal care.
While many people may find coverage in the current open enrollment period, which ends March 31, they can still get coverage when their current policy ends.