Health Team

Grandfathering health plans creates uncertainty

Posted November 14, 2013
Updated November 15, 2013

— President Barack Obama's decision Thursday to allow people to remain for at least a year on health plans that don't meet the minimum requirements of the Affordable Care Act left many questioning the impact and feasibility of the switch.

More than 473,000 North Carolinians faced the prospect of having their existing health coverage canceled in January because the plans don't provide the "minimum essential benefits" outlined under the new health care law. Outcry over the cancellations, especially after Obama repeatedly promised that people who liked their existing insurance could keep it, prompted the sudden reversal Thursday.

"What we want to do is to be able to say to these folks, 'You know what, the Affordable Care Act is not going to be the reason why insurers have to cancel your plan,'" Obama said during a news conference to announce the change.

Amy Williamson, whose Blue Cross Blue Shield of North Carolina plan was slated for cancellation, said the move didn't bring her much comfort.

"I would like to know before Dec. 1 whether or not I have the option to go back to the old plan I had," Williamson said, noting she would need to enroll in a new plan by Dec. 15 to obtain coverage by the start of January.

"Not knowing how much I'm going to pay Jan. 1 is kind of nerve-wracking," she said.

The single mother said she prefers keeping her old health plan, which would save her at least $100 a month in premiums over plans offered through North Carolina's online insurance exchange. But she's unsure whether insurers can make the change in such a short time frame.

"I think it's a quick fix he's trying to do," she said of Obama. "Maybe it will help some people in some states, but I don't think it will help me." Obama's health plan move could create winners, losers

Blue Cross Chief Executive Brad Wilson said resurrecting any old policies to grandfather them for 2014 would have to be approved by the state Department of Insurance because it would necessitate a rate change.

"We had already been actively exploring options to provide some relief to customers who were faced with losing a plan they liked," Wilson said. "This additional flexibility could help insurers take steps to protect their customers for another year."

Aetna, which owns Coventry Health Care of the Carolinas, the only other insurer aside from Blue Cross to offer plans through North Carolina's exchange, also backs Obama's move but said much work needs to be done quickly to make it happen.

"We will need cooperation and expedited approval from state regulators to remove barriers that would make it difficult to make this change in such a short period of time," Aetna spokesman Walt Cherniak said in a statement. "State regulators will need to allow us to update our policies and secure appropriate rates so we can get these plans back in the market."

Insurance Commissioner Wayne Goodwin said the DOI is gathering and analyzing data to figure out how best to protect consumers.

Although the grandfathered plans could benefit some, insurance industry officials said pulling people out of the exchanges will likely lead to higher premiums for others.

"Changing the rules after health plans have already met the requirements of the law could destabilize the market and result in higher premiums for consumers," America's Health Insurance Plans warned in a statement.

Louisiana Insurance Commissioner Jim Donelon, president of the National Association of Insurance Commissioners, also said Obama's proposal could lead to market disruptions next year and beyond.

"It is unclear how, as a practical matter, the changes proposed today by the president can be put into effect," Donelon said. "In many states, cancellation notices have already gone out to policyholders, and rates and plans have already been approved for 2014."

Members of Congress were quick to either criticize or laud the president, depending on their political stripes.

"President Obama’s attempt at political damage control today did absolutely nothing to provide relief for the damage already inflicted on individuals who already had health care coverage and the entire health care industry as a result of the Affordable Care Act," Republican U.S. Sen. Richard Burr said in a statement. "If anything, the president only dug himself further into a hole by putting forth an unworkable proposal that will amount to nothing more than another broken promise."

"While I remain concerned by difficulties implementing the Affordable Care Act, what we will not do is use these challenges as an excuse to repeal the law, which House Republican leaders called for yet again today. I am unwilling to turn my back on the millions of Americans who have been waiting for years to access quality insurance," Democratic 4th District Congressman David Price said in a statement.


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  • CarolinaTim Nov 15, 2013

    Junk mail,
    I tried being nice but have it your way.

    Obama lied to get elected, re elected and to pass the
    Holy Grail Obamacare. You defend the liar with
    your every breath and that makes you complicent
    with His lies.

    He has defrauded America and should resign immediately.

    Nixon was more honorable than Obama.
    The financial harm to our country has and will
    be long lasting and severe.

    We will only recover if people with a conscience and intelligence out number the recipient class that only want to vote for A party of lying "Santa Claus'"

  • Ex-Republican Nov 15, 2013

    "Chances are he doesn't even know what it is...since he doesn't seem to know much of anything else. Benghazi what? Insurance huh? What website doesn't work?" educateyourself

    Excellent observation. Back in 2008 America was sold a lie. Hope and Change and Yes We Can is what America bought. I'm so disappointed in my country that my fellow Americans elected empty slogans and not a President.

  • Ex-Republican Nov 15, 2013

    Our only hope is far the Tea Party to gain power and repeal this ObamaCare mess. Even then, by the time that happens, ObamaCare will have wrecked the economy. It will take at least 20 years to clean up all the damage Obama has wrought on this country.

  • McLovin Nov 15, 2013

    great, so just like the government shut down a month ago and most like will go through the same nonesense in Jan/Feb. Now you get to keep your insurance and in a year from now have it cancelled one more move cheif

  • bulletmom14 Nov 15, 2013

    So, I really do not see this happening...but, he has spoken and if it doesn't happen it will be due to someone else....typical of this administration....I'm not sure these insurance companies are going to resurrect these old plans regardless what he says....he shouldn't have said "you can keep your plan" since he had no clue what he was talking was a no brainer that folks would be cancelled....

  • misschris234 Nov 15, 2013

    "No, I don't (though again- he said he wants UNIVERSAL coverage... which is NOT AT ALL the same as single payer)-Junk"

    NOT AT ALL the same? I'd say they are far more similar than not.

  • onlymy2cents Nov 15, 2013

    An actual SOURCED STUDY covering almost 150 hospitals though, which is what I ACTUALLY PROVIDED certainly DOES trump an anecdote of "I remember seeing stuff when I was a kid!"

    No it doesn't. The data does not discredit his experience. You missed the entire was his experience.

    And 8 spots in a poll of this size is not significant. See you tried that same ole bs again. We are talking about the position of the country in the poll not the percentages. Swing and another miss there junkie.

  • ecu4me2 Nov 15, 2013

    And the best Sen.Hagan can do is ask for an investigation on the Webb site...Democrats have ruined health care for all but the poor and they were already getting free medical...why can't democrats do what's right and ditch the unafforadable health care acr

  • foodstamptrader Nov 15, 2013

    "President GW Bush set the record for receiving vitriol and hostility. President Obama has surpassed him." - jackaroe123

    Barack Hussein Obama is the most hated, divisive president in history...

  • cinnamon16 Nov 15, 2013

    educate yourself are so correct