Tuesday, September 25, 2018
Health

Canceled by Florida Blue? You can keep your policy for another year

Florida's largest health insurer will give 300,000 customers who received cancellation notices the option to renew their existing plans for one more year.

Florida Blue's decision comes in the wake of President Barack Obama's reversal on Thursday. Facing political pressure over the cancellations, Obama told insurers they could revive the plans for another year, even though they don't meet the requirements of the Affordable Care Act.

Florida Blue is the only insurer participating in the federal marketplace in all 67 Florida counties, offering plans that meet coverage standards of the health care law. It now joins other insurers that had earlier provided the one-year renewal option to customers whose individual plans would otherwise be canceled.

These plans do not comply with the ACA, because, for instance, they may allow excessive out-of-pocket spending or lack essential benefits such as maternity coverage. For relatively healthy people who don't qualify for Obamacare subsidies, the monthly premium cost of the new, more comprehensive plans is generally much higher than under the old plans.

Other insurers, including Humana and Cigna, had already allowed policyholders to renew before the end of this year so they could keep their plans through 2014. (Florida is among the states that permit this). But most existing Florida Blue plans would have expired next summer.

Now, plans that would have ended in summer 2014 may continue through summer 2015, said Florida Blue spokesman Paul Kluding. Members can expect to receive letters explaining their options.

That was good news to David Reilly, a 58-year-old health care consultant from Oldsmar. He and his wife have a Florida Blue plan they like — at $840 a month, it carries a $3,000 deductible and covers everything they need — but learned recently that it would be discontinued next summer because it doesn't have all the ACA essential benefits.

When Reilly began shopping for new plans, he found premiums that were nearly twice as high — and deductibles that were even higher than the one he had.

Reilly, who generally supports the law, said he'd always assumed skimpy plans wouldn't make the cut. But he didn't think major medical plans like his would go away, too.

"That was a complete bombshell to me," he said.

Nearly 10 percent of Florida Blue's 300,000 previously canceled policies are "Go Blue," essentially a discount card with few benefits beyond basic preventive care.

Those plans, labeled "junk insurance'' by Consumer Reports, will also get a one-year extension. Federal officials said Friday that policyholders who chose to renew their existing policies will not be subject to a fine for failing to secure insurance.

Michael Palin, 56, a New Port Richey resident whose wife has a $79-a-month Go Blue plan, said he expects they will keep it for one more year. Based on their income, Palin, who has no insurance for himself, and his wife would likely qualify for a subsidy to buy a new plan. But with all the problems that the Obamacare website has had, Palin said he'll wait.

"I don't like change," said Palin, who works as a supervisor with a private ambulance company. "My job is very stressful and anything that's new can really just throw me off."

Obama announced his proposal Thursday as pressure mounted over his false promise that people who like their insurance could keep it.

Insurance lobbyists said that the shift could come at a cost. Insurers based their premiums for next year on having large risk pools to help offset costs of the new plans.

Robert Zirkelbach, the spokesman for America's Health Insurance Plans, said, "If now fewer younger and healthier people choose to purchase coverage in the exchange, premiums will increase and there will be fewer choices for consumers."

Caroline Pearson, vice president of health reform at consultant Avalere Health, said many questions remain over how Obama's shift will shake out. Because each state and the insurers themselves must decide whether to take the option Obama gave them, it's unclear how many customers with canceled policies may opt to renew, and how premiums will be affected.

Also unclear is whether insurers can raise premiums when existing plans are renewed for 2014. Pearson said that could depend on whether insurers get permission to factor medical inflation into their pricing.

She noted that continuing the junk insurance plans is at odds with what the law intended to do. "It does really kind of undermine one of the goals of the law, which was to set minimum benefits," she said.

Jodie Tillman can be reached at [email protected] or (813) 226-3374.

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