President Obama’s Fix for Cancelled Plans

Last week President Obama stated that the Affordable Care Act (ACA) will not result in a loss of coverage for certain individual and family health insurance policyholders. I will explain the significance of his statement and other facts.

I am not making a political statement nor have I ever made a political statement in any e mail or blog. My intent is to provide honest information  and nothing more.

The ACA does require that those with medical conditions cannot be denied or charged more premium, it eliminates lifetime maximums on policies and provides other coverage which is beneficial. These are very positive changes.

This e mail does not apply to groups, Medicare or individual and family grandfathered plans in effect before March 23, 2010. If an individual or family plan was effective prior to March 23, 2010 and was changed after that date the grandfathered status is lost, it is now a non grandfathered plan and this e mail applies.

The controversy is that on many occasions President Obama stated that if you like your plan you can keep it. This is not the case.

All individual and family non grandfathered plans of Anthem Blue Cross, Blue Shield of California, Health Net and Kaiser are being cancelled and migrated on January 1, 2014.  These plans will be changed to an ACA compliant plan. As long as your premium is paid you will not have a lapse in coverage.

 The issue is whether this new plan is more advantageous than your current plan. Many supporters of the ACA have stated that the reason for the change is positive because current non grandfathered plans are “substandard”.  Although the new ACA compliant plans may have more coverage than the current non grandfathered plan, the substandard label is generally defined as lacking some coverage such as hospitalization, doctors office visits, maternity and prescriptions. The overwhelming majority of health plans in effect in California have these benefits. In fact all of my clients have these benefits so these plans are not substandard.

There are many cases including my own where the new migrated plans will cause some degradation of the plan. Here are some examples where one or more of the following may happen;

Increased deductibles for the medical and prescriptions

Increased Annual Out of Pocket Expense

Increased premium

Decreased hospital network

Decreased physician network

Loss of certain prescriptions

In response to the public outcry President Obama stated that the ACA will not dictate that the non grandfathered plans be cancelled on January 1, 2104 and be allowed to remain in effect for one more year. I applaud the decision to keep the plans but the plans should be able to remain in effect permanently if the person so chooses. In addition I am disappointed that it took the President so long to make this decision. It is very late in the year which adds pressure to the decision making process of whether to wait until we know if the plans will remain in effect, keep the migrated plan or investigate other options.

The decision by President Obama does not guarantee that the non grandfathered plans can remain. Continuation of the plans for another year has to be approved by the State of California (on several levels) and the insurance companies that must provide a benefit analysis of the plan differences (current versus migrated) to approximately one million Californians. I have communicated with Anthem Blue Cross, Blue Shield of California and Health Net, they have not decided what course to take.

This has resulted in more confusion and further delays the ability I have to help you with your choice of coverage. At this point if you make a choice to change your plan you may not have the opportunity to go back to your current  non grandfathered plan if the State and insurance companies agree to the President’s fix.

Several states have decided they will not reverse course and will continue the process of cancellations and migrations.

I am still waiting for approval of new Anthem Blue Cross and Cigna individual and family plans. They are important considerations for your health insurance choice in 2014.

 If you are not eligible for a federal subsidy to help with your health insurance costs there is no reason to apply to Covered California the Health Insurance Exchange/Marketplace. You will have more options in the open market.

Information on subsidy is attached.

 Stay tuned.

Certified Covered California Agent # 2000001789
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Dennis David
PO Box 548
Culver City, CA 90232
Voice 310 836 9893
Fax 310 836 3840

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The Dennis L. David Insurance Agency | Long Term Care Insurance, Los Angeles Medical Insurance, Anthem Blue Cross Healthcare Insurance, Whole & Term Life Insurance Policies, Cigna, Disability Insurance, Blue Shield of CA, Group Health Plans, Aetna, Group Medical Insurance, Skilled Nursing Insurance, Medicare Supplement Insurance, Medicare Part D Prescription Drug Plans, In-Home Care, Disabled Work Insurance, Disability Benefits, Culver City Health & Life Insurance, Family & Individual Health Insurance, Health Care Reform & Affordable Care Act Assistance, Obamacare, Covered CA Health Insurance, Health Plans, Kaiser Insurance, Genworth Life, John Hancock Life, Culver City Long Term Care & Disability, Employee Benefits, Beverly Hills, Hollywood, West Hollywood, Santa Monica, Pacific Palisades, Marina Del Rey, West Los Angeles, Los Angeles, El Segundo, Sherman Oaks, Encino, Los Angeles, Manhattan Beach, Los Angeles County CA, California

CA Insurance License Number:  0668857

TX Insurance License Number:  1774174