Florida Blue informs 300,000 members health care plans will expire

dchang@MiamiHerald.comOctober 31, 2013 

Hundreds of thousands of Floridians are afflicted with something critics of the Affordable Care Act long have warned about: rate shock. It's the unpleasant experience of seeing your health insurance rates jump as a result of the health care reform law -- in contradiction with President Barack Obama's often-repeated promise that, "If you like your plan, you can keep it."

This month, Florida Blue, the state's largest and oldest health insurer, notified 300,000 members that when their plans expire in 2014 they must enroll in new plans that comply with requirements of the ACA that insurers offer coverage to everyone, regardless of pre-existing conditions, and that plans cover 10 "essential health benefits" such as hospitalization, prescription drugs and maternity care.

Florida Blue executives insist the company isn't dropping the members -- it's only dropping their plans, which no longer qualify under the law.

"We're not terminating anyone's coverage," said Jon Urbanek, Florida Blue's senior vice president of commercial markets. "We're essentially going to go through a transition to qualified plans."

It's a distinction that some Florida Blue members have a hard time seeing -- especially when the new plan costs more and offers benefits they don't necessarily want.

But there are others -- generally older, sicker people who had a harder time finding health insurance in the past because of pre-existing conditions -- who welcome the change. A qualified plan is likely to lower their monthly premiums and improve their coverage. And still other members will experience little or no change in their costs or coverage level.

"Each individual will experience very different impacts," said Douglas Lynch, vice president and chief actuary for Florida Blue.

Urbanek said more than half of the estimated 200,000 individual and family policies affected by the change have comprehensive benefits comparable with those required under the health law.

But it's unclear how many Florida Blue members will pay more and how many will pay less for their new, qualified plans, because an unknown number of those policy holders also may be eligible for federal financial aid to help pay their monthly premiums. That aid is available to individuals and families earning up to four times the federal poverty level, or $45,960 a year for an individual and $94,200 a year for a family of four.

Another factor affecting the cost of health insurance rates is the ACA itself, which requires that insurers now cover anyone who applies, even with a pre-existing condition -- a requirement known as "guaranteed issue."

"Guaranteed issue and no pre-existing conditions will impact practically all of our members," Lynch said, "and represent a significant portion of the overall impact our members will experience."

But it was the Florida cancellations, followed by complaints of rising prices, that caught the public's attention, triggering another onslaught of criticism of the ACA. Obama had promised many times in 2008, 2009 and 2010 that Americans could keep their health insurance if they liked it.

What the president did not say, and what many Americans were unaware of, is that insurance companies could close those plans at their discretion, said Julie Bataille, press director for the Center for Medicare and Medicaid Services, the agency within the U.S. Department of Health and Human Services that oversees the public health programs and the online insurance exchange.

"There's nothing in the health care law that makes insurers force people out of plans that they were enrolled in before the law," she said. "The truth is that insurers are upgrading their plans."

But that's only part of the truth. The rest? Only people enrolled in so-called "grandfathered" plans can keep their current health insurance plan, and even then only if the insurer chooses to continue that plan.

Urbanek said Florida Blue still covers about 30,000 individuals through grandfathered plans -- defined as plans that existed before the enactment of the law in March 2010 and that have kept the same level of benefits, copayments and deductibles.

Individuals in Florida Blue's grandfathered plans will not be transitioned into new, qualified health plans.

"Those folks can keep the plan that they have," Urbanek said.

But Florida Blue is no longer enrolling new individuals into grandfathered plans, either.

Officials with Florida's Office of Insurance Regulation said they do not know how many grandfathered plans exist in Florida, but that some insurers were closing those plans.

Florida Blue is not the only insurer moving members out of their old health insurance plans and into new, qualified plans. But Florida Blue is the leader in the state's individual major medical health insurance market, which is where people who do not get health care coverage through an employer buy insurance if they can afford it.

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