USA TODAY International Edition
SCRATCH THAT: YOU CAN KEEP IT, FOR NOW
Chaos ensues over insurance reversal
David Isenstadt has spent the past six weeks working 12- hour days, seven days a week, trying to reach all of his insurance clients with canceled policies to switch them to new policies. Now this.
President Obama’s announcement Thursday that consumers can keep for a year insurance plans that don’t meet the Affordable Care Act will only create chaos, insurance brokers, regulators and carriers say.
“To make a possible change like this now will only cause more confusion and compound the problems that the ACA is causing” on Jan. 1, says Isenstadt, who owns New England Insurance Group in Guilford, Conn.
The insurance industry is none too pleased that the onus is now on them to satisfy consumers who are outraged about policies being canceled. Insurers and insurance commissioners don’t have to let people extend their plans, but “it will no longer be implementation of the law that is forcing them to buy a new plan,” the White House said in a fact sheet.
The head of the insurance industry’s trade group says extensions could lead to higher premiums, just the effect Obama’s announcement was intended to prevent.
“Changing the rules after health plans have already met the requirements of the law could destabilize the market and result in higher premiums for consumers,” Karen Ignagni, CEO of American’s Health Insurance Plans ( AHIP), said in a statement.
And Washington state’s insurance commissioner came out quickly declaring he won’t allow insurance companies to extend policies.
“In the interest of keeping the consumer protections we have enacted and ensuring that we keep health insurance costs down for all consumers, we are staying the course,” Commissioner Mike Kreidler said in a statement.
One thing’s for sure: No one really knows how this will play out.
“It is unclear how, as a practical matter, the changes proposed today by the president can be put into effect,” National Association of Insurance Commissioners President Jim Donelon said in a statement.
Aetna said it supports efforts to let people keep their plans, but urged state regulators to allow it to update the company’s policies and get rate approval so it can get its plans “back on the market,” spokesman Matthew Wiggin said.
Aetna, like AHIP, says the administration has to take action to stabilize the market to keep the move from backfiring and hurting consumers.
In Illinois, insurance broker Allen Wishner says few of his clients with canceled policies had chosen new plans yet.
He’s still waiting for all the regulatory guidance he needs from the state before he switches anyone’s policy back to a pre- ACA policy and says he’ll be on a conference call this morning with Blue Cross Blue Shield.
Says Wishner: “The customer service department will be working overtime. It’s going to be quite chaotic.”