Healthcare Policy Extensions Vary Among States

Wednesday, 04 Dec 2013 07:38 AM

By Melissa Clyne

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Whether states will allow health insurers to extend current individual policies for another year appears to be a red or blue issue, The Wall Street Journal reports.

Insurance commissioners of mostly Republican-led states have said they will allow the extensions, while Democratic-led states are less inclined.

Twenty-one of 30 states with Republican governors, including Florida, New Jersey, North Carolina, Ohio, and Texas have green-lighted the president’s extension that would allow individual policy holders to keep their existing coverage through September 2015.

The District of Columbia and 10 blue states, including Connecticut, Massachusetts, Minnesota, New York, and Washington have said they will not allow current plan extensions, while nine others, including Illinois, Kentucky, Missouri and Oregon have agreed to the extension. California won’t allow insurance companies selling coverage on the state exchange to extend policies but has said other insurers can.

The president agreed to the one-year extension as a purported administrative fix to the Affordable Care Act following public and political outrage resulting from millions of cancellation notices received by individual consumers across the country. About 15 million Americans buy insurance on their own, according to the Journal.

America’s Health Insurance Plans, the nation’s largest trade group for insurance companies, has voiced opposition to the president’s “fix,” arguing it could turn the marketplace on its head.

Premiums under the rules of the Affordable Care Act were set based on transitioning to the new market, according to the group’s president, and changing the rules mid-game would destabilize the market.

The plans that have been cancelled did not meet the minimum requirements under Obamacare.

“Policyholders who want to keep their plans, which are typically less comprehensive than the new plans, are believed to be healthier people,” according to the Journal.

Some states worry that removing these younger, healthier people from the health exchanges, even for a year, could collapse the market, which is one reason the District of Columbia and other Democratic states have decided not to allow current plan extensions.

According to NBC News, insurance industry officials and state insurance commissioners warned the Obama administration in 2010 that the Affordable Care Act would result in millions of canceled policies. The experts told NBC that they were “baffled” by Obama’s assertion that the cancellations occurred because a key provision of the healthcare law did not work as expected, when in fact the administration was told the law would have exactly that effect.

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