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By Sara Hansard
Dec. 1 — Humana Inc. is discontinuing the individual health plans that were in existence before the Affordable Care Act was enacted and that don't comply with the law's prohibitions against refusing coverage or charging more to people with health problems.
In an e-mail sent to Bloomberg BNA, Mark Mathis, director of corporate communications in the Chicago office of Humana, said “Humana chose to no longer maintain grandfathered individual health plans in eleven states in order to retain the overall affordability of our individual health plan offerings.” The change affects fewer than 40,000 members, or less than 5 percent of Humana's 963,700 individual health plan members as of Sept. 31, he said.
Karen Pollitz, a senior fellow at the Kaiser Family Foundation (KFF), told Bloomberg BNA Dec. 1 that only about 16 percent of enrollees in the individual market were in plans that don't comply with the ACA's requirements, which include covering a comprehensive set of benefits. “The profitable thing for an insurer to do at this point is to bring all its healthy people into the reformed risk pool,” she said.
“Our goal—both on- and off-exchange—is to provide quality, affordable health plan coverage,” Mathis said. “We consistently assess our current product offerings and make changes in order to maintain sustainable and affordable health plans for our members. Humana continues to offer a range of options via state and federal Marketplaces/Exchanges.”
The affected plans are in Alabama, Arizona, Colorado, Florida, Georgia, Mississippi, Ohio, Oklahoma, South Carolina, Tennessee and Wisconsin, Mathis said. The changes take effect on the date a member's plan renews starting in March 2016, and Humana is notifying members at least 90 days in advance, he said.
Open enrollment is under way for ACA marketplace plans through Jan. 31 for 2016 plans. The Department of Health and Human Services expects about 10 million people to be enrolled in the marketplaces at the end of 2016.
Meanwhile, Carolina Gipson, who owns a real estate brokerage company in Atlanta with her husband, Kent, told Bloomberg BNA Dec. 1 that her transitional Blue Cross and Blue Shield of Georgia (BCBSGA) individual plan for her family of four is being terminated.
BCBSGA spokeswoman Debbie Diamond confirmed that the company is ending the so-called grandmothered plans at the end of 2015.
In late 2013 President Barack Obama, in reaction to rising anger over the cancellation of plans that weren't compliant with the ACA, announced that insurers could continue noncompliant plans if state regulators agreed. Some of those grandmothered, transitional plans are continuing through September 2016, Pollitz said. Some health insurers have been canceling the noncompliant plans in advance of the September 2016 date.
Gipson said she has been paying $692 a month in premiums and she is trying to determine how much it would cost her to find a comparable plan that complies with the health law. According to Gipson, all of the comparable BCBS plans would cost at least $800 a month, and it isn't clear if she would qualify for ACA subsidies.
“The issue is whether or not I could keep my doctors,” Gipson said. “I have a master's in health system engineering from Georgia Tech and I still can't figure this out.”
The ACA allows for grandfathered plans that were in existence when the law was enacted to continue indefinitely, although regulations issued in 2010 by the Department of Health and Human Services sharply limited changes that could be made in those plans, such as raising out-of-pocket costs for deductibles, copayments and coinsurance.
The noncompliant plans are cheaper than ACA-compliant plans and they attract healthier enrollees, Pollitz said. That means enrollees in the ACA-compliant plans are likely to be less healthy and have higher health-care costs, she said.
In May KFF released a survey finding that 16 percent of approximately 800 adults interviewed had plans that didn't comply with the ACA. In September KFF released a survey finding that 35 percent of firms offering health benefits offer at least one grandfathered health plan, and 25 percent of covered workers are enrolled in a grandfathered plan.
If health insurers are able to bring people from the noncompliant plans into the ACA plans, “they won't lose as much money,” Pollitz said. “If you're going to have insurance to finance health care you need your pool to be big and cover most people.”
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