Author Archive | John Barrett

ObamaCare makes it more difficult to buy insurance year-round

Here’s more fallout from the health care law: Until now, customers could walk into an insurance office or go online to buy standard health care coverage any time of year. Not anymore.

Many people who didn’t sign up during the government’s open enrollment period that ended Monday will soon find it difficult or impossible to get insured this year, even if they go directly to a private company and money is no object.

  • With limited exceptions, insurers are refusing to sell to individuals after the enrollment period for HealthCare.gov and the state marketplaces. They will lock out the young and healthy as well as the sick or injured. Those who want to switch plans also are affected. The next wide-open chance to enroll comes in November for coverage in 2015.

It’s a little-noted consequence of President Obama’s health care overhaul, which requires nearly all Americans to be insured or pay a fine and requires insurers to accept people with health problems.

  • Those who act now may still be able to get in, depending on where they live. Following the lead of the government marketplaces, some companies are extending off-marketplace sales for a week or a month to help people who hit snags trying to enroll by this week’s deadline. Rules vary from state to state.

After those extensions, eligibility for coverage during 2014 is guaranteed only for people who experience certain qualifying life events, such as losing a job that provided insurance, moving to a new state, getting married, having a baby or losing coverage under a parent’s health plan.

  • The federal law doesn’t prevent companies from selling policies to everyone all year. But insurers consider it too risky now that the law prohibits them from rejecting people in poor health.

“If you didn’t have an open enrollment period, you would have people who would potentially enroll when they get sick and dis-enroll when they get better,” said a spokesman for insurer Kaiser Permanente. “The only insured people would be sick people, which would make insurance unaffordable for everyone.”

  • A survey by the Kaiser Family Foundation in mid-March found that 6 out of 10 people without insurance weren’t aware of the marketplace deadline on March 31. The Obama administration, insurance companies and nonprofit groups scrambled to spread the word, often with messages that focused on the cost savings available to many people through the government marketplaces.

There wasn’t much public discussion about people who prefer to buy policies outside the marketplaces, sometimes finding better deals or options more to their liking.

  • A Health and Human Services spokesman pointed to a cryptic note on the HealthCare.gov website: It says “in some limited cases some insurance companies may sell private health plans outside the marketplace and outside open enrollment” that satisfy the law’s coverage mandate. It doesn’t say how to find any companies doing that.

A health law expert at the Kaiser Family Foundation, said it’s “highly unlikely” that companies will offer such coverage after the deadline window fully closes. Some do still offer temporary plans, lasting from a month to a year. But those plans don’t cover pre-existing conditions and don’t get buyers off the hook for the law’s tax penalty.

*Modified from a FoxNews.com article

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15-20 Percent Aren’t Paying Obamacare Premiums, Insurer Says

New data from a major insurer suggest real enrollment is at roughly 6 million. One of the biggest players in Obamacare’s exchanges says 15 to 20 percent of its new customers aren’t paying their first premium—which means they’re not actually covered.

  • The latest data come from the Blue Cross Blue Shield Association, whose members—known collectively as “Blues” plans—are participating in the exchanges in almost every state. Roughly 80 to 85 percent of people who selected a Blues plan through the exchanges went on to pay their first month’s premium, a BCBSA spokeswoman said Wednesday.

The new statistics, particularly from such a large carrier, help define how many people are actually getting covered under the Affordable Care Act.

  • The Blues’ experience is in line with anecdotal estimates from other insurance executives, who indicated earlier in the enrollment process that they received payments from about 80 percent of people who selected their plans. The Blues’ latest estimate includes policies that took effect Feb. 1 or earlier, the spokeswoman said.

Some health care analysts have suggested that the payment rate could improve later in the enrollment window, as plans had more time to track down consumers who hadn’t paid.

  • Wherever the final number ends up, it will be the real measure of how many people are actually covered through the Affordable Care Act’s exchanges. The Obama administration has been releasing the number of people who selected a plan, but says it doesn’t have accurate data on how many have actually paid. And consumers don’t have coverage they can use until they make that first payment.

If the nationwide payment rate, across all carriers, remains at 80 to 85 percent, the 7.1 million sign-ups Obama announced Tuesday would translate into somewhere between 5.7 and 6 million people who are actually covered.

*Modified from a Nationaljournal.com article

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Exchange plans worry California docs

Dr. Mark Dressner says California’s public exchange need to act now to keep physicians in the networks. Dressner, president of the California Academy of Family Physicians, said doctors who treat Covered California exchange plan patients feel confused, frustrated and poorly paid.

  • Doctors say plan reimbursement rates are 20 percent to 40 percent lower than traditional plan rates. “Our physicians describe these payment reductions as unaffordable to their practices,” Dressner says.

“Carriers seem to think they can change contract terms by simply sending letters to the physicians. Physicians have trouble finding out what the plan contract terms are, or even finding out whether they’re really in a plan provider network”.

  • “In parts of California, for example, low reimbursement rates have resulted in a doctor rebellion, as nearly seven out of 10 doctors refuse to participate in the exchanges.”

Meanwhile, nationally known health insurance providers like United Healthcare, Aetna, Cigna are staying out of the Obamacare exchange marketplaces. Anthem Blue Cross and Blue Shield are in, but are sharply narrowing their networks to exclude many doctors, as well as elite hospitals.

As a result, well-known hospitals like Los Angeles’ Cedars-Sinai, New York’s Memorial Sloan-Kettering and the NewYork-Presbyterian Hospital will be out of reach for many exchange patients.

*Modified from a LifeHealthPro.com and Washingtonexaminer.com article

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O-Care premiums to skyrocket

Health industry officials say ObamaCare-related premiums will double in some parts of the country, countering claims recently made by the administration. The expected rate hikes will be announced in the coming months, and the sticker shock would likely hamper ObamaCare insurance enrollment efforts in 2015.

The industry complaints come less than a week after Health and Human Services (HHS) Secretary Kathleen Sebelius sought to downplay concerns about rising premiums in the healthcare sector. She told lawmakers rates would increase in 2015 but grow more slowly than in the past. “The increases are far less significant than what they were prior to the Affordable Care Act,” the secretary said in testimony before the House Ways and Means Committee.

  • Her comment baffled insurance officials, who said it runs counter to the industry’s consensus about next year. “It’s pretty shortsighted because I think everybody knows that the way the exchange has rolled out … is going to lead to higher costs,” said one senior insurance executive who requested anonymity.

The insurance official, who hails from a populous swing state, said his company expects to triple its rates next year on the ObamaCare exchange. The hikes are expected to vary substantially by region, state and carrier.

Areas of the country with older, sicker or smaller populations are likely to be hit hardest, while others might not see substantial increases at all.

Much will depend on how firms are coping with the healthcare law’s raft of new fees and regulatory restrictions, according to another industry official.

  • Some insurers initially underpriced their policies to begin with, expecting to raise rates in the second year. But insurance officials are quick to emphasize that any spikes would be a consequence of delays and changes in ObamaCare’s rollout.

They point out that the administration, after a massive public outcry, eased their policies to allow people to keep their old health plans. That kept some healthy people in place, instead of making them jump into the new exchanges.

  • Perhaps most important, insurers have been disappointed that young people only make up about one-quarter of the enrollees in plans through the insurance exchanges, according to public figures that were released earlier this year. That ratio might change in the weeks ahead because the administration anticipates many more people in their 20s and 30s will sign up close to the March 31 enrollment deadline. Many insurers, however, don’t share that optimism

“We’re exasperated,” said the senior insurance official. “All of these major delays on very significant portions of the law are going to change what it’s going to cost.”

  • “My gut tells me that, for some people, these increases will be significant,” said Bill Hoagland, a former executive at Cigna and current senior vice president at the Bipartisan Policy Center. Hoagland said Sebelius was seeking to “soften up the American public” to the likelihood that premiums will rise, despite promises to the contrary.

Insurers will begin the process this spring by filing their rate proposals with state officials. Insurance commissioners will then release the rates sometime this summer, usually when they’re approved. Insurers could also leak their rates earlier as a political statement.

Jon Gruber, who also helped design the Affordable Care Act, said, “The bottom line is that we just don’t know. Premiums were rising 7 to 10 percent a year before the law. So the question is whether we will see a continuation of that sort of single digit increase, or whether it will be larger.”

In Iowa, rates are expected to rise 100 percent on the exchange and by double digits on the larger, employer-based market, according to a recent article in the Business Record.

*Modified from a Hill.com article

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Health Insurance Rates Likely to Rise in 2015

Health and Human Services Secretary Kathleen Sebelius said health-insurance premiums are “likely to go up” in 2015, an acknowledgment that the Obama administration doesn’t believe the sweeping changes to the health-insurance marketplace will end premium increases in the near term.

  • The range of premiums people will see in 2015 is expected to be an important measure of the health-care law’s success. Supporters have staked its success on providing coverage that people consider to be “affordable,” though they have generally stopped short of claiming that its provisions will directly lead to premium decreases.
  • For now, the impact of those changes is unknown, because insurers have just begun weighing their rates for the year to come. The enrollment period for coverage in the coming year is still open—it closes at the end of this month—and insurers are hoping to have more information about medical claims by the time they need to submit their proposed rates to federal and state governments later this spring.
  • Many consumers across the U.S. saw premiums increase in 2014 because of requirements that new plans be more generous. Premiums for individuals who had previously benefited from the lowest rates because they could show clean bills of health also rose. But many of those rates were based on guesswork by health plans about the riskiness of the customers they would end up with, and as our Exchange Explorer tool shows, they have bet all over the map.
  • The law’s messy rollout added another twist, as it may have skewed the makeup of people who obtained coverage toward those who knew they were more likely to need it.
  • So far, the proportion of young Americans signing up for coverage through state and federal exchanges created under the health-care law has remained below levels thought necessary to keep premiums stable.
  • On Tuesday, the Obama administration released enrollment numbers for February showing that about 25% of people age 18 to 34 picked a plan, lower than a 40% target believed to keep premiums relatively stable. However, there are risk-adjustment provisions in the law designed to compensate insurers that end up with higher medical claims now that they can’t charge people more based on their medical history, and federal officials have previously said they expected those to mitigate any premium increases.
  • Overall, the administration said 4.2 million people enrolled in health-insurance plans through February, a number that suggests enrollment could fall short of projections made by the nonpartisan Congressional Budget Office that 6 million to 7 million people would enroll in private plans for 2014.

*Modified from a WSJ.com article

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ObamaCare’s Secret Mandate Exemption

HHS quietly repeals the individual purchase rule for two more years.

ObamaCare’s implementers continue to roam the battlefield and shoot their own wounded, and the latest casualty is the core of the Affordable Care Act—the individual mandate. To wit, last week the Administration quietly excused millions of people from the requirement to purchase health insurance or else pay a tax penalty.

  • This latest political reconstruction has received zero media notice, and the Health and Human Services Department didn’t think the details were worth discussing in a conference call, press materials or fact sheet. Instead, the mandate suspension was buried in an unrelated rule that was meant to preserve some health plans that don’t comply with ObamaCare benefit and redistribution mandates. Our sources only noticed the change this week.
  • That seven-page technical bulletin includes a paragraph and footnote that casually mention that a rule in a separate December 2013 bulletin would be extended for two more years, until 2016. Lo and behold, it turns out this second rule, which was supposed to last for only a year, allows Americans whose coverage was cancelled to opt out of the mandate altogether.
  • In 2013, HHS decided that ObamaCare’s wave of policy terminations qualified as a “hardship” that entitled people to a special type of coverage designed for people under age 30 or a mandate exemption. HHS originally defined and reserved hardship exemptions for the truly down and out such as battered women, the evicted and bankrupts.
  • But amid the post-rollout political backlash, last week the agency created a new category: Now all you need to do is fill out a form attesting that your plan was cancelled and that you “believe that the plan options available in the [ObamaCare] Marketplace in your area are more expensive than your cancelled health insurance policy” or “you consider other available policies unaffordable.”
  • HHS is also trying to pre-empt the inevitable political blowback from the nasty 2015 tax surprise of fining the uninsured for being uninsured, which could help reopen ObamaCare if voters elect a Republican Senate this November. Keeping its mandate waiver secret for now is an attempt get past November and in the meantime sign up as many people as possible for government-subsidized health care.
  • Sources in the insurance industry are worried the regulatory loophole sets a mandate non-enforcement precedent, and they’re probably right. The longer it is not enforced, the less likely any President will enforce it.
  • This lax standard—no formula or hard test beyond a person’s belief—at least ostensibly requires proof such as an insurer termination notice. But people can also qualify for hardships for the unspecified nonreason that “you experienced another hardship in obtaining health insurance,” which only requires “documentation if possible.” And yet another waiver is available to those who say they are merely unable to afford coverage, regardless of their prior insurance. In a word, these shifting legal benchmarks offer an exemption to everyone who conceivably wants one.
  • Keep in mind that the White House argued at the Supreme Court that the individual mandate to buy insurance was indispensable to the law’s success, and President Obama continues to say he’d veto the bipartisan bills that would delay or repeal it. So why are ObamaCare liberals silently gutting their own creation now?
  • The answers are the implementation fiasco and politics. HHS revealed Tuesday that only 940,000 people signed up for an ObamaCare plan in February, bringing the total to about 4.2 million, well below the original 5.7 million projection. The predicted “surge” of young beneficiaries isn’t materializing even as the end-of-March deadline approaches, and enrollment decelerated in February.
  • Meanwhile, a McKinsey & Company survey reports that a mere 27% of people joining the exchanges were previously uninsured through February. The survey also found that about half of people who shopped for a plan but did not enroll said premiums were too expensive, even though 80% of this group qualify for subsidies. Some substantial share of the people ObamaCare is supposed to help say it is a bad financial value. You might even call it a hardship.
  • The larger point is that there have been so many unilateral executive waivers and delays that ObamaCare must be unrecognizable to its drafters, to the extent they ever knew what the law contained.

*Modified from a WSJ.com article

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“Junk” Health Plans and Other Obamacare Insurance Myths

Obamacare affects nearly all areas of health care, but the most disruptive provisions of the law affect insurance sold in the individual market. In 2013, at least 4.7 million policyholders across 31 states and the District of Columbia were notified that their current coverage was being discontinued. The number is likely even higher, since data were not available for 19 states.

  • Myth: The canceled health plans were “substandard” policies.
  • Myth: Before Obamacare, there were routine plan cancellations in the individual market.
  • Myth: Pre-existing condition exclusions were rampant before Obamacare.
  • Myth: Obamacare plans are “better” insurance.

Obamacare’s advocates claim that the law and its plethora of new insurance regulations were necessary to better protect consumers in this market. They discount the large disruption of coverage for millions of people by claiming that the plan cancellations were for “substandard” policies and that plans were routinely canceled in this market regardless of Obamacare. Further, they assert that the law will replace these plans with “better” insurance all of which is largely untrue.

  • Myth: The canceled health plans were “substandard” policies.

President Obama has repeatedly referred to the 4.7 million discontinued policies as “substandard.” When the President announced his administrative “fix” that attempted to allow those with canceled plans to keep their existing plans for another year, Senator Tom Harkin (D–IA) said he was still “concerned about people having policies which don’t do anything. They’re just junk policies.”

Typically, “substandard” refers to plans with limited benefits, which are commonly seen as inadequate because they do not protect against catastrophic costs. These types of plans typically cover routine care, but if there were a major medical event, they might pay only up to a certain amount before leaving the enrollee to pay the rest.

Obamacare gradually phased out these types of plans from 2010 to 2013—completely outlawing them by 2014—by prohibiting both annual and lifetime limits on coverage.

Limited-benefit plans are not nearly as prevalent in the individual market as they are portrayed to be. Of the nearly 16 million enrollees in the individual market in 2012, 725,710 individuals were enrolled in plans classified as limited-benefit plans, and slightly more than a million were in student health plans, which also typically have a limited benefit package. Thus, less than 11 percent of the individual market in 2012 had a plan that could reasonably be considered “substandard.”

Limited-benefit plans are mostly offered by employers in the group market. Indeed, of the temporary waivers received by over 4 million plan enrollees from the Obama Administration for Obamacare’s annual limit caps before they were completely phased out, only 3.7 percent were for individual market plans; the rest were given to enrollees in group market plans.

  • Myth: Before Obamacare, there were routine plan cancellations in the individual market.

Many Obamacare defenders blame the discontinued policies on “bad apple insurers,” claiming that it was typical in this market to have plan cancellations and that they are not a result of Obamacare.

For instance, former Obama Administration official Van Jones called the individual marketplace a “‘wild, wild west’ where people were denied coverage for pre-existing conditions and policyholders were continually dropped by insurers offering thin, sketchy coverage.” In addition, President Obama said, “Before the Affordable Care Act, the worst of these plans routinely dropped thousands of Americans every single year.”

But since the enactment of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), insurers have been broadly prohibited from canceling or refusing to renew coverage. One of the few exceptions to that prohibition is if an insurer discontinues a particular plan or type of coverage. In such cases, the insurer must provide the affected individuals the option to enroll in any other applicable coverage that the insurer offers.

That is largely what happened with the 4.7 million plan cancellations that were reported at the end of 2013. The insurers were discontinuing their pre-Obamacare plans and offering policyholders replacement coverage that complied with Obamacare’s wide variety of new mandates and regulations.

  •  Myth: Pre-existing condition exclusions were rampant before Obamacare.

Individuals being denied health insurance or kicked off their plans because of pre-existing medical conditions is often cited by defenders of Obamacare as justification for the law. The President has said that “up to half of all Americans have a preexisting condition.”

However, while the problem did exist, it was on a much smaller scale than depicted. The issue was in the individual market, where about 10 percent of the privately insured purchase coverage. In the group market, where about 90 percent of privately insured Americans are covered, the issue was mostly resolved by HIPAA.

Beginning in 2014, Obamacare enforced a blanket prohibition of pre-existing condition exclusions in the individual market. A consequence of this policy is that it incentivizes people to wait until they are sick to purchase coverage. Thus, the law also included an individual mandate to force all Americans to purchase health insurance or pay a tax penalty.

Since the provisions did not take affect right away, the law created the pre-existing conditions insurance plan (PCIP) to operate from 2010 to 2014. It funded new high-risk pools in each state to provide temporary coverage to those with pre-existing conditions.

The PCIP experience revealed that the number of individuals facing pre-existing condition exclusions was not nearly as large as it was portrayed. The Obama Administration initially estimated that 375,000 people would enroll in the PCIP by 2010, but the highest enrollment total ever to occur over the three-year period was in March 2013: almost 115,000, only about 30 percent of original projections.

  • Myth: Obamacare plans are “better” insurance.

Obamacare does indeed mandate a host of new benefits that every plan must cover and new rules that each insurer must follow, but the result is not just standardization and over-regulation of health insurance; it also increases costs, which is seen in premiums and cost-sharing levels.

For instance, the average deductible for a bronze plan in the 34 states with a federally facilitated exchange is $5,095 a year for an individual, and the average catastrophic plan carries an individual deductible of $6,346. Moreover, 42 states will see significant average premium increases—in many cases, over 100 percent—for individuals purchasing from the exchanges. Therefore, enrollees may not see “better” insurance for their money.

*Modified from a heirtage.org article

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Health insurance marketplaces signing up few uninsured Americans, surveys say

The new health insurance marketplaces appear to be making little headway so far in signing up Americans who lack health insurance, the Affordable Care Act’s central goal. A pair of surveys released on Thursday suggest that just one in 10 uninsured people who qualify for private health plans through the new marketplace have signed up for one — and that about half of uninsured adults has looked for information on the online exchanges or plans to look.

  • One of the surveys, by the consulting firm McKinsey & Co., shows that, of people who had signed up for coverage through the marketplaces by last month, just one-fourth described themselves as having been without insurance for most of the past year.
  •  The survey also attempted to gauge what has been another fuzzy matter: how many of the people actually have the insurance for which they signed up. Under federal rules, coverage begins only if someone has started to pay their monthly insurance premiums.
  • And, the survey show, that just over half of uninsured people said they had started to pay, compared with nearly nine in 10 of those signing up on the exchanges who said they were simply switching from one health plan to another.
  • The McKinsey survey, its fourth since late November to measure the behavior of Americans in the new insurance marketplaces, is based on a national sample of about 2,100 people. It shows that 27 percent of people who had bought coverage by early February had been uninsured, compared with 11 percent a month earlier.
  • McKinsey’s survey also includes people who bought insurance outside the new marketplaces. It defined uninsured people as those who qualify for private health plans sold through the exchanges. It does not include anyone who is uninsured and has an income low enough that they qualify for Medicaid, a public insurance program that is being expanded under the law in about half the states.
  • The McKinsey survey also found, as it had during the previous few months, that, of people who are uninsured and do not intend to get a health plan through the marketplaces, the biggest factor is that they believe they could not afford one.
  • The second survey, by researchers at the Urban Institute and based on slightly older data from December, shows that awareness of the new marketplaces is fairly widespread but that lower-income Americans and those who are uninsured are less likely to know about this new avenue to health coverage than other people.

“If there is one point to the law, it is to lower the number of uninsured,” said Larry Levitt, senior vice president of the Kaiser Family Foundation, a health policy organization. “Ultimately, that has to happen for the law to be judged a success.”

With just over three weeks remaining in a six-month sign-up period, the question of how many uninsured people are gaining coverage so far is eluding both Obama administration officials and most of the private health plans being sold through the new marketplaces.

Inside the Department of Health and Human Services, staff analysts who have been producing monthly enrollment updates are confronted with a major hindrance to examining the question of people’s prior insurance status: the wording of the HealthCare.gov applications themselves.

The paper versions of applications, used by a small fraction of people who are signing up contain a multiple-choice question asking whether people in a household currently have insurance. “No” is one of the boxes people can check

However, the online application, used by most people to enroll, asks whether people want to apply for coverage but does not give them a place to indicate whether they have insurance now or have had it in the past. As a result, HHS analysts have no way of assessing how many of the online enrollees were uninsured n the past.

“We are a looking at a range of data sources to determine how many marketplace enrollees previously had coverage,” said Julie Bataille, director of the Office of Communication in the Centers for Medicare and Medicaid Services, the HHS agency overseeing the insurance marketplaces. “Previous insurance coverage is an important metric, and we hope to have additional information in the future.”

In the absence of information from people who have enrolled, Obama administration officials have drawn attention to recent outside polls, which suggest that the overall number of uninsured Americans is declining. It is not clear, however, whether the trend is because of the health-care law or other reasons.

So far, of 14 states that are operating their own insurance exchanges, instead of relying on the federal one, only New York has given any indication about how many uninsured people are signing up. Last month, the NY State of Health, the state’s marketplace, reported that 70 percent of the half-million people who had enrolled since it opened in October were uninsured at the time they signed up.

*Modified from a Washingtonpost.com article

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Consumers can keep old health plans into 2017, administration says

The Obama administration announced Wednesday that some Americans with health insurance policies that don’t meet consumer standards set by the Affordable Care Act will be allowed to keep their plans into 2017, three years later than originally envisioned.

Allowing some consumers to keep old insurance plans past the end of the President Obama’s term in office marks the latest effort by the administration to get out from under one of the most damaging controversies shadowing the launch of the healthcare law.

Senior administration officials, briefing reporters on condition of anonymity, said they believe that about 1.5 million consumers nationwide currently are covered under such plans, about 500,000 of which were purchased by individuals and the rest by small businesses.

“The goal is to implement the Affordable Care Act in a common-sense way,” a senior administration official said, adding that officials believe that this latest announcement will be the last significant change the administration will make in the law’s deadlines and requirements.

Officials also announced that the open enrollment period for healthcare coverage next year would begin on Nov. 15 — notably after the fall’s midterm elections — and extend through February 2015.

Many Americans who had bought healthcare plans on their own were stunned last fall when insurance companies announced that their policies would be canceled because they did not include required benefits or meet other standards set by the law.

Because Obama had promised that people who liked their existing plans would be able to keep them, the cancellation letters quickly became a major political issue.

White House officials repeatedly have said that the vast majority of people who got cancellation notices were able to replace their old policies with new ones, in some cases at lower cost. However, those arguments have not quelled the political uproar. Conservative and Republican groups already have run millions of dollars’ worth of advertising against Democratic candidates on the issue, accusing them of participating in the “lie of the year.”

The healthcare law was designed to phase out health insurance plans in 2014 if they did not include a basic set of benefits or include limits on how much consumers can be required to pay out of pocket for their medical care.

After the controversy broke, the administration announced that state regulators could allow insurers to renew old policies in 2014. Not all states have gone along with that plan. Some, particularly those with liberal, Democratic insurance regulators, have balked at allowing what they consider sub-standard plans to remain on the market.

The new guidance would allow those plans to be renewed again as late as Oct. 1, 2016, meaning that some consumers could hold on to their healthcare plans into 2017.

The practical effect of the new extension may be limited. Officials said they believe that the number of consumers covered by plans that don’t meet the law’s standards will be significantly lower by 2016 because of the usual churn in the market for individual insurance.

“The expectation is that this will be a very small number of people,” a senior official said.

However, the new extension may defuse a political time bomb that the administration would have faced later this year if some consumers had once again received notices canceling their insurance plans just ahead of the November elections.

*Modified from a latimes.com article

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Rising Premiums May Hit Small Firms

Report Predicts 65% Will Pay More for Health Insurance. A federal actuarial report predicts that 65% of small businesses will see their health-insurance premiums increase under part of the Affordable Care Act.

  • The report, from the Centers for Medicare and Medicaid Services Office of the Actuary, is the latest piece of bad news for the president’s signature domestic achievement. The report analyzed employers with 50 or fewer full-time employees that buy outside insurance policies for workers, a group it estimated at 17 million people in 2012.
  • The report concluded that about 65% of small businesses, or plans covering 11 million people, would see an increase in insurance premiums under these so-called community-rating provisions of the health law. About 35% of employers would see a decrease for plans covering six million people. These employers aren’t required to pay a penalty under the federal health law if they don’t insure workers.
  • The report didn’t estimate by how much premiums would increase or decrease for the groups. It also didn’t take into account other parts of the health law that impact the cost of plans, such as tax credits that small businesses are eligible for if they offer insurance.
  • In 2009, before the Affordable Care Act passed, the Congressional Budget Office estimated that most small businesses wouldn’t see a big impact on premiums from the proposed health law. It projected a rise of 1% to a reduction of 2% in premiums for small employers in 2016 when the law was fully implemented.
  • Indeed, the impact on premiums for small employers under the health law for 2014 hasn’t been fully seen. Many employers renewed existing plans early, and about half of states allowed insurance policy extensions under pre-health law rules, according to the CMS report. The report also noted “there is a rather large degree of uncertainty associated with this estimate.”
  • Additionally, the report said small businesses with healthier-than-average employees were more likely to offer health insurance before 2014 and were paying below-average premiums.
  • In November, the Obama administration delayed the online enrollment for small businesses though healthcare.gov for a year. Small businesses that want to participate in the federal small business exchange need to enroll directly through an insurance company or use an agent or broker. This exchange is available for small businesses with 100 or fewer employees.

*Modified from a WSJ.com article

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