New Yorkers who were told they had to switch health plans because their policies didn’t meet the standards of the Affordable Care Act probably won’t be offered a chance to put the process on hold, despite the president’s announcement this week that insurers in some states may be allowed to keep offering noncompliant plans for another year.
Health insurers in New York say that with just a month and a half left in the year, resurrecting policies scheduled to be phased out on Dec. 31 would be a logistical nightmare they would rather avoid. They also questioned whether any consumers would benefit.
“Just trying to go back and recreate a product that you’ve eliminated is not something that plans are looking forward to with great enjoyment,” said Leslie Moran, vice president of the New York Health Plan Association.
Insurers, she said, have already sunk a year’s worth of work into creating and marketing the new ACA-compliant policies and getting rates approved with state regulators. Reactivating the old ones would mean rushing a reworked rate structure through a regulatory process that normally takes months. Insurers would then have to contact tens of thousands of New Yorkers whose old policies had been canceled and hurry them through enrollment.
It might also mean getting legislative approval. New York lawmakers attached language to the state budget earlier this year prohibiting the sale of any policies declared substandard under federal law. Insurance company lawyers are interpreting that to mean that a change in law would be needed for the eliminated policies to be restored.
“That’s an awful lot of work to do in a very short time,” said Donald Ingalls, vice president at BlueCross BlueShield of Western New York.
It’s unclear how many New Yorkers would want their old plans back, anyway.
New York’s web-based marketplace for the new plans, unlike its federal counterpart, has been functioning smoothly, industry officials said. Tens of thousands of New Yorkers that had been told they had to switch have already done so.
In other states, some consumers were looking at substantial price increases for their health insurance because the bare-bones policies they previously held were being banned for skimpy coverage. Some had expressed outrage that they were being forced to buy expanded coverage they didn’t believe they needed. That largely isn’t the case in New York, where state regulations previously mandated robust coverage.
State officials said about 88,000 New Yorkers have to change health plans because the state’s government-subsidized insurance program, Healthy New York, is being phased out as the ACA makes it obsolete. The great majority of those people are expected to be able to get better coverage for comparable premiums on the state’s new health benefits exchange.
Page 2 of 2 - About 16,000 New Yorkers who now purchase a health plan directly from an insurer will also need to buy new polices, but few are likely to complain about the cancellation of their old plans: Most will see their premiums slashed in half in the new policies.
There are also changes ahead for an undetermined number of New Yorkers who get health insurance coverage through small-group policies. Some of those plans will also be undergoing changes to bring them into compliance with the federal law.
Price increases in those plans, however, are likely to be in the single digits, said Nora McGuire, chief marketing officer at the western New York insurer Independent Health. That’s less of an increase than many buyers had seen in previous years, and this time the hike will buy better coverage, McGuire said.
Gov. Andrew Cuomo’s administration didn’t immediately indicate Friday whether it would take any action to allow or require insurers to reactive policies being phased out.
“We are reviewing the president’s announcement and doing the necessary due diligence on the matter,” said Matt Anderson, a spokesman for the New York State Department of Financial Services.