Obama meets with state insurance regulators

November 20, 2013

State insurance commissioners met Wednesday with President Obama at the White House, where they say he acknowledged that some states were unlikely to implement his proposal to reverse millions of health insurance cancellations.

The commissioners shared their own concerns about the workability of his plan, which would give insurers an additional year to sell coverage that does not comply with the Obama health-care law’s regulations.

“He acknowledged that each state has to do what it deems appropriate and what its laws require,” Jim Donelon, president of the National Association of Insurance Commissioners, said of the meeting. “We had a great dialogue, but we also came away with an agreement that there was a lot of differences of opinion over whether we can or should do what he urged us to do last week.”

The 50-minute meeting in the Oval Office included regulators from Louisiana, North Carolina and Connecticut. Other regulators invited to participate declined to attend, citing opposition to the hastily scheduled meeting.

Commissioners say the president was open to their ideas and understanding of the obstacles that stand in their way.


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“It wasn’t the president trying to persuade or stiff-arm us,” Connecticut Insurance Commissioner Thomas Leonardi said. “He was wanting to make the point that he gets the value in our diversity and wants to help.”

The meeting comes after Obama caught many state regulators by surprise last week when he announced that insurers can continue offering policies through 2014 that don’t meet the basic requirements of the Affordable Care Act. Insurers who do so would give some consumers an extra year to keep policies that otherwise would have been canceled.

The proposal was aimed at solving a problem that was threatening the president’s credibility — he had repeatedly promised that people who liked their plans could keep them.

But the move also raised a host of questions for state insurance regulators, who must approve such policy changes before insurers reissue the plans, as well as for insurers and consumers.

In North Carolina, where regulators said they would quickly review such insurer requests, the state’s largest health insurer, BlueCross BlueShield, said Tuesday that it was asking for rate increases of 16 to 24 percent to renew about 150,000 policies that would have been canceled for failing to meet minimum requirements under the federal overhaul law. The insurer said it filed the necessary documents with the state Insurance Department that could allow 230,000 customers to keep their current coverage next year. The 16 percent rate increase covers more than half of the customers, a company spokesman said.

The insurer said it hoped to mail revised renewal notices to eligible customers around Dec. 1.

Kansas’s largest health insurers also said Tuesday that they will offer another year of coverage under plans that they had expected to cancel in 2014 because of the federal health-care overhaul. BlueCross and BlueShield of Kansas said it hopes to notify about 10,000 policyholders within the next week that they can continue with their existing, individual coverage. The company had sent them notices canceling their policies as of Jan. 1, leaving them to find new health plans.

In Maryland, CareFirst BlueCross BlueShield announced Wednesday that it will offer about 50,000 subscribers the chance to renew policies that were going to be canceled. Policyholders can keep their current insurance through 2014 by re-enrolling in their existing plan at the 2013 premium rates, if they act by Dec. 16.

The issue has split state regulators, some of whom were invited to the White House but chose not to go. In an e-mail sent to their colleagues Tuesday night, six commissioners said they were not attending the meeting.

“We made this difficult decision not to attend due to the fact that we were either not invited to do so, or were invited but have declined, but in all cases we have serious reservations about both the process and the policy issues surrounding such an important meeting,” according to the e-mail, a copy of which was obtained by The Washington Post.

The message was signed by six commissioners, including several executives of the trade association: Adam Hamm of North Dakota, Monica Lindeen of Montana and Michael Consedine of Pennsylvania.

But regulators in six states have decided against allowing consumers in noncompliant plans to renew coverage after Dec. 31. Most recently, regulators in Maryland and Minnesota announced that they would not implement the president’s proposal.

Virginia officials announced Wednesday that they did not believe they had regulatory authority to implement the proposal, but encouraged health insurers to offer early renewals until the end of the year.

Regulators are concerned that allowing these plans to continue would mean that some consumers would have health coverage that is less robust than the health law intended. They are worried, too, about the impact on the insurance exchange. The people who currently get low premiums in the individual market are likely to be healthier, and allowing them to keep policies not sold through the exchange could raise premiums for people buying coverage in the new marketplace.

The individual policies were being canceled because they didn’t include coverage for preexisting conditions, hospitalization, prescription drugs and seven other basic benefits.

Lena H. Sun is a national reporter for The Washington Post, focusing on health.
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