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Insurers, blaming health care reform, will stop selling new 'child only' policies

LOS ANGELES — Major health insurance companies in a number of states have decided to stop selling policies for tens of thousands of children rather than comply with a new federal health care law that bars them from rejecting youngsters with pre-existing medical conditions.

Anthem Blue Cross, Aetna Inc., Cigna Inc. and others will halt new "child-only" policies in Florida and elsewhere Thursday when provisions of the nation's new health care law take effect, including a requirement that insurers cover people younger than 19 regardless of their health histories.

The action will apply only to new coverage sought for children and not to existing family policies or those provided to youngsters through their parents' employers. As many as an estimated 500,000 children nationwide would be affected by the insurers' decisions, according to state and national experts.

Insurers said they are acting because the new federal requirement could create huge and unexpected costs for insuring children. They say the rule may prompt parents to buy insurance only after their kids become sick. As a result, they say, many insurers would flee the marketplace, leaving only a few to shoulder a huge financial burden.

The companies said that they now sell relatively few child-only policies, and as a result the changes will have only a small effect on families.

"Unfortunately, this has created an unlevel competitive environment," Anthem Blue Cross, California's largest for-profit insurer, said in a statement declaring its intention to "suspend the sale of child-only policies" after Thursday, the six-month anniversary of the new federal health care law.

The change has infuriated lawmakers, regulators and health care advocates, who say it will force more families to enroll in already strained public insurance programs.

The White House weighed in Tuesday, condemning Anthem corporate parent WellPoint Inc. and others who have announced they'll stop selling the policies.

"It's obviously very unfortunate that insurance companies continue to make decisions on the backs of children and families that need their help," White House press secretary Robert Gibbs told a White House news briefing.

Other regional and national insurers also plan to stop selling insurance policies exclusively for children. Included in this group is UnitedHealth Group, the nation's largest insurer by revenues, although it did not say which states would be affected.

Aetna said that effective Thursday it will no longer offer policies in the 32 states where it conducts business, including Florida. Cigna will halt the policies in 10 states, not including Florida.

Insurers, blaming health care reform, will stop selling new 'child only' policies 09/21/10 [Last modified: Tuesday, September 21, 2010 10:46pm]
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