What consumers need to know about health care changes

  • Updated: November 16, 2013 - 5:35 PM

President Obama is trying to make it possible for Americans to keep their health insurance coverage if they like it. But his now infamous promise may not be realistic. Obama said last week that insurers should be allowed to continue selling individual coverage plans that would be deemed substandard under the health care overhaul to existing customers. The decision came after millions of people received cancellation notices alerting them that their plans would not have complied with overhaul coverage requirements set to begin next year.

A day later, the House voted to let insurers sell those existing plans to new as well as existing customers. That bill now goes to an uncertain fate in the Senate. Insurance experts say there are a number of obstacles that could keep insurers from letting customers renew old policies that the companies had planned to scrap for 2014. Here’s what you need to know:

can anyone keep AN old plan?

Maybe not — even under the president’s new directive. It’s up to the insurers whether to renew them or not. And even if they do, the final word will come from state insurance commissioners, who will decide whether to permit the renewals.

WHAT WILL MY INSURER DO?

Your insurer likely doesn’t know yet. Several companies said they were still trying to understand the implications behind the directive. Aetna Inc., the nation’s third-largest health insurer, plans to extend some of its canceled policies. Robert Laszewski, a health care industry consultant, said he expects other insurers to make a decision over the next few days.

CAN’T INSURERS JUST CONTINUE THE COVERAGE THEY HAD IN PLACE?

The decision is far more complex. Insurers would need to figure out how much to charge since they haven’t set premiums, or the price of coverage, for plans they expected to scrap. They have to consider how the coverage will be used and how prices have risen before settling on what they need to collect to cover future claims. They also have to send letters to customers with canceled policies, telling them that the coverage can now be renewed. They also have to inform customers who want to keep canceled plans about any protections that are now required but are not included under the old plans. Insurers then have to wait for customers to decide whether to keep the coverage and respond. Insurers have to do all this in about 30 days in order to have coverage ready to start Jan. 1.

how is the House bill different from Obama’s directive?

In addition to allowing current policyholders to keep their noncompliant plans, the House bill would permit new customers to buy the old policies. Obama administration officials say that provision would undermine the law.

How can the president change terms of the health care law?

The Department of Health and Human Services used its “enforcement discretion,” which allows it to mend or alter policies that ease the transition of a substantial change in the law. The administration did the same thing by delaying enforcement of the law’s employer mandate.

WHAT CAN I DO IF I DON’T GET TO RENEW MY COVERAGE?

Customers have until Dec. 15 to use the overhaul’s insurance exchanges to sign up for health insurance coverage that starts in January. The premiums they find may be higher because the law requires more extensive coverage than what some plans currently offer. But customers also may be eligible for income-based tax credits to help them foot the bill. Many insurers also are letting policyholders renew their coverage early, which would let them keep their plans through most of 2014. Customers who do not qualify for a subsidy also should look beyond the exchanges. They only show plans for which subsidies can be used, and an insurer may make other options available in the policyholder’s state.

What features will the 2014 plans have that the renewable canceled plans won’t?

A number of consumer protections and coverage enhancements, including access to coverage regardless of current or past health problems; benefits that cover at least 60 percent of medical costs; limited out-of-pocket costs, such as co-payments and deductibles; no annual or lifetime benefit spending limits; no rate variances based on gender, occupation or medical claims history; and required coverage of 10 benefits that include mental health services, prescription drugs, pediatric services, and maternity and newborn care.

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