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Insurers on Obamacare change: Say what?

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Highmark Inc. said it this way: “It is unclear how these proposed changes can be put into effect.”

The locally prominent health insurer’s response to the president’s announcement Thursday seems representative of the industry, which has just seen the rules changed in the middle of the game, as it were.

“Making sure consumers have secure, affordable coverage is health plans’ top priority,” America’s Health Insurance Plans’ President and CEO Karen Ignagni said in a prepared statement. “The only reason consumers are getting notices about their current coverage changing is because the ACA requires all policies to cover a broad range of benefits that go beyond what many people choose to purchase today.”

“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,” Ignani continued. “Premiums have already been set for next year based on an assumption of when consumers will be transitioning to the new marketplace. If due to these changes fewer younger and healthier people choose to purchase coverage in the exchange, premiums will increase in the marketplace and there will be fewer choices for consumers. Additional steps must be taken to stabilize the marketplace and mitigate the adverse impact on consumers.”

The president’s announcement yesterday essentially extends Obamacare’s grandfathering provision for another year, allowing people to keep policies that otherwise would be canceled. But there’s a big caveat: Customers could keep the plans only if their state’s insurance commissioners approve and their insurers decide to continue offering the plans.

Pennsylvania’s insurance commissioner has not yet issued a response to the announcement, but in an open letter Thursday to President Obama, Gov. Tom Corbett said the following: “Here in Pennsylvania, we are working directly with our consumers and insurance companies to provide more direct options. I have asked the Pennsylvania Insurance Commissioner to have insurers contact all cancelled policyholders to make sure each are offered a comparable product to alleviate people having months without any health care access.”

Corbett also urged the president “to support fast-track legislation to let Pennsylvanians keep their current insurance policies. Unlike the original ACA legislation, this legislation has bi-partisan support and will move quickly with White House support. Also, let insurance professionals and carriers provide access to coverage including direct enrollment in Qualified Health Plans.”

Corbett’s letter also touched on the related subject of Medicaid funding.

“On a separate, but equally important note, the trust in federal funding commitments continues to be a significant concern,” Corbett wrote. “Pennsylvania recently received notice of a significant drop in the federal Medicaid matching rate (FMAP). If accurate and implemented, this federal reduction would result in the Commonwealth of Pennsylvania losing over $325 million next fiscal year.

“I am hereby asking you, and the Department of Health and Human Services (HHS), to examine this issue due to its potential impact to critical services provided to our most vulnerable citizens,” Corbett continued. “This reduction would be the most drastic cut in federal funds in the past 30 years. At the very same time of this potential extreme reduction we are working in good faith with HHS to provide health care access to uninsured Pennsylvania citizens. This effort is based upon the promise of your Administration and trust that federal funding to cover the uninsured will be made available.”

The president’s announcement came in context of gathering support on two competing bills on the subject: Senate Bill 1642 by Democratic Sen. Mary Landrieu, and House Bill 3350 by Republican Rep. Fred Upton.

Landrieu’s bill is similar to the administrative change the president announced Thursday, but does not include a time limit on the grandfathering. Upton’s bill specifies that the extension is for 2014 but, unlike the president’s change, would allow people who are not currently enrolled in the extended plans to purchase them.

The full text of Highmark’s statement is as follows:

“Highmark is strongly committed to ensuring consumers can continue to obtain affordable, quality health care coverage. Because the Affordable Care Act requires all health insurance policies to cover a broad array of benefits, we discontinued individual health plans for 40,000 members in Pennsylvania and 5,200 members in Delaware.

“Due to serious problems with the federal exchange website, consumers whose policies were discontinued are now faced with significant challenges obtaining coverage through the new health insurance marketplaces.

“Certain consumers whose policies are being discontinued would qualify for federal subsidies and would need to obtain coverage though the federal exchanges if they intend to secure financial assistance. However, other consumers with discontinued policies are not likely to qualify for subsidies and can immediately secure the very same quality, health care coverage at the same rates as our products on the federal exchange by coming directly to Highmark to enroll. In many cases, the options available to these consumers are better coverage at better prices than what they have currently.

“Today, the president announced that the federal government would employ its discretion to delay enforcement of Affordable Care Act market reforms in 2014 for plans that are currently in effect. It is unclear how these proposed changes can be put into effect.

“Many of the details of the federal proposals to change the Affordable Care Act are still in development, including the operational and financial implications to insurance companies. At minimum, the government needs to ensure a stable health insurance market and not allow health care costs to escalate as a result of the federal exchange’s challenges. We will work with the federal and state governments to better understand and execute on this as the details are known.”

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