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By Rose Hoban
Hundreds of thousands of North Carolinians who buy insurance on the individual marketplace will be able to keep their current coverage plans after several days of scrambling by federal and state officials.
Last week, President Barack Obama bowed to increasing pressure from millions of Americans who have received letters from their insurance carriers telling them that their plans are being canceled. Those plans can now stay in effect for another year as federal officials get the Affordable Care Act into place.
That move meant states needed to decide whether or not they would honor the current plans. Some states chose to reject the fix.
But on Friday, North Carolina Insurance Commissioner Wayne Goodwin announced his office would expedite the process for approving the old plans for the coming year.
“Normally, we’d receive data from insurance companies for filing each year, and we conduct a review to make sure rates are in compliance with the law before folks could use them,” Goodwin said in an interview Friday evening. “Usually, the process would take months for my actuaries and other experts at the department to do that review.”
Goodwin said his department would approve the plans for now and then retroactively review them to see that they are in compliance with state law.
“The process requires insurers to attest to their compliance. But if we discover that carriers overcharged policyholders, or it’s determined by the department that a carrier is non-compliant with the law, we may hold them to some kind of administrative action,” Goodwin said.
Hundreds of thousands affected
The quick fix affects about 473,000 North Carolinians covered by about 183,000 policies that were in effect through this year. More than 151,000 of those policies were written by Blue Cross and Blue Shield of North Carolina.
An additional 100,000 old policies written by BCBSNC meet the new standards laid out in the Affordable Care Act and will be grandfathered for 2014. The people covered under those plans won’t see changes and didn’t receive the letters.
According to a statement by the company Friday, BCBSNC had been in discussions about extending the terminated policies before the president made his announcement on Thursday.
“There are still important details to work through, and both our company and the Department of Insurance have committed to work as quickly as possible,” said BCBSNC CEO Brad Wilson in the statement. “We expect to be able to provide more details about customers’ renewal options on or around December 1.”
BCBSNC spokesman Lew Borman said the company would file plans with the Department of Insurance this week and would have more details later in the week.
Both Goodwin and Borman noted that even though people could keep their old policies, they would probably see premium increases for the coming year.
“There would have been increases in premium costs because health care costs increase year over year normally,” Borman said. “They’ll also reflect the broader, deeper benefits and the fees and taxes that are part of the new plans, as well as the increased cost of medical care.”
Goodwin cautioned that even if plans are reinstated, consumers should shop around.
“Most people don’t realize that there are numerous plans and that there are intricate and myriad differences between and among the plans that even one company is offering,” he said. “We regularly remind folks to take time for due diligence; shop around. Contact an agent or a broker you trust, or contact the Department of Insurance if you have questions about the process.”
Borman said his company had given subscribers information earlier this year that their policies would change once the Affordable Care Act went into effect fully.
“They’d had notice. After ACA passed, we wrote a letter to say that if you make a change to your current policy, it may impact your grandfathering status,” Borman said of the letters that go out annually to insurance-plan subscribers. He said that for several years, the company has included a paragraph in those letters stating that “this could mean something to you.”
BCBSNC is not the only insurer that will have to scramble to get new rates filed with the Department of Insurance. Data provided by DOI indicate that at least 14 other companies will be filing plans to extend coverage for about 241,000 people.
Another seven companies have decided to pull out of the North Carolina market, meaning the 2,378 people covered under those 1,051 policies will have no choice but to look elsewhere for insurance.
Goodwin praised insurers who are moving quickly to file for the coming year. But he also expressed frustration that state lawmakers prevented North Carolina from creating its own insurance exchange under the Affordable Care Act.
“Some things the states can do better; but in this instance, our state deferred to the feds, like many other states,” he said.
“If we’d had our own exchange, we’d have had North Carolinians controlling our destiny,” Goodwin said. “That’s better than seeing things play out in White House press conferences and in the halls of Congress.”