Thursday, October 24, 2013

Welcome to the ACA: Hundreds of Thousands Receive Health Insurance Cancellation Letters. No Way! Way!

Health plans are sending hundreds of thousands of cancellation letters to people who buy their own coverage, frustrating some consumers who want to keep what they have and forcing others to buy more costly policies.”

“But the cancellation notices, which began arriving in August, have shocked many consumers in light of President Barack Obama’s promise that people could keep their plans if they liked them.

“I don’t feel like I need to change, but I have to,” said Jeff Learned, a television editor in Los Angeles, who must find a new plan for his teenage daughter, who has a health condition that has required multiple surgeries.

An estimated 14 million people purchase their own coverage because they don’t get it through their jobs. Calls to insurers in several states showed that many have sent notices.

Florida Blue, for example, is terminating about 300,000 policies, about 80 percent of its individual policies in the state. Kaiser Permanente in California has sent notices to 160,000 people – about half of its individual business in the state. Insurer Highmark in Pittsburgh is dropping about 20 percent of its individual market customers, while Independence Blue Cross, the major insurer in Philadelphia, is dropping about 45 percent.” - Thousands Of Consumers Get Insurance Cancellation Notices Due To Health Law Changes, Kaiser Health News, 10/21/2013

Update 10/26/2013

“Hundreds of thousands of Americans who purchase their own health insurance have received cancellation notices since
August because the plans do not meet Obamacare's requirements.

The number of cancellation notices greatly exceed the number of Obamacare enrollees.”

“Several states have released Obamacare enrollment data, however, revealing extremely low rates. South Dakota reported that only 23 people enrolled in the exchanges, a mere 0.0000276 percent of that state’s population. North Dakota enrolled only 20 residents.

Alaska, meanwhile, comes in at seven total enrollees, or 0.000957 percent of Alaskans.” - Health insurance cancellation notices soar above Obamacare enrollment rates, The Daily Caller, 10/24/2013


The prior individual plans would all be "private" plans hence one would expect such plans to have a rather wide negotiated network of providers. If one receives the letter and buys "off exchange" from the same insurer (assuming the insurer sells off exchange policies), meaning one is purchasing another private plan, then the network would be rather wide as it is the same negotiated network of the same insurer.

If one dumped the current insurer and purchased from another insurer, in an off-exchange situation, one would need to examine the network but more than likely it is the particular insurer's negotiated network they have been cultivating for years.

However, say one receives the cancellation letter and goes to the ACA exchange and buys. Those networks are much more narrow as supposedly, according to insurers, the narrower network lowers price. Here is a situation that is bound to happen and one may do one's self a disservice:

(1) cancel letter arrives,

(2) one has an income that precludes a subsidy,

(3) however, rather than going off-exchange one merely goes through the ACA exchange. No subsidy is forthcoming but anyone can use the exchange regardless of subsidy or no subsidy,

(4) one applies and is approved,

(5) one has just been approved for a narrow network rather than the broader network available in the "off-exchange" world.


The entire Kaiser Health News article and Daily Caller articles appear in the links below:

Updated 11/05/2013

Flowchart of President Obama’s “You can keep your plan, period” defenses - Keith Hennessey, 11/04/2013

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