6
   

Why are individual plans being cancelled?

 
 
RobertW
 
Reply Thu 12 Dec, 2013 04:56 pm
I am one of those small entrepreneurs who received the dreaded cancellation letter. Like a fool I believed the "if you like your plan you can keep it" nonsense. The least expensive "conforming" plan I can replace it with is 30% more expensive with much higher deductibles and poorer coverage. And I am one of the lucky ones.

I am trying to understand exactly why these are being cancelled.

The insurance company (Anthem BC/BS of CT) claim that they had no choice but to cancel my grandfathered plan because it was "non-conforming". In fact, I have read that the law was deliberately written to force the cancellation of individual plans, including grandfathered ones.

However, a friend of mine (granted, an Obamaton) told me that the law permits "non-conforming" grandfathered plans, but the insurance companies are using ObamaCare as an excuse to terminate less-than-profitable plans.

Does anyone know the true story? Is it a little bit of both? Why exactly are these plans being cancelled?
 
maxdancona
 
  3  
Reply Thu 12 Dec, 2013 05:04 pm
@RobertW,
Quote:
he least expensive "conforming" plan I can replace it with is 30% more expensive with much higher deductibles and poorer coverage.


I am skeptical about the claim that the new plan has poorer coverage. To back up this claim, can you please provide

1. A link to the coverage in both the old plan and the new plan, as well as deductible and whether there is a yearly maximum.

2. What it was about the old plan that made it "non-conforming".

My belief is that these "non-conforming" policies are basically junk policies. A lot of people had "health-care" plans that didn't really cover them when they needed it. I don't believe that insurance companies had many "less-than-profitable" plans. Otherwise they would have terminated them long ago.

In general these low-cost "junk" policies are extremely profitable (since they cover very little). They are little more than a scam. I would be interested in seeing the details of your current plan.
RobertW
 
  1  
Reply Fri 13 Dec, 2013 05:53 am
@maxdancona,
You are not answering the question. Incidentally, the cancelled plan was an excellent one. If you are maintaining that only "junk" plans are being cancelled you are incorrect.
maxdancona
 
  1  
Reply Fri 13 Dec, 2013 08:23 am
@RobertW,
Quote:
You are not answering the question. Incidentally, the cancelled plan was an excellent one. If you are maintaining that only "junk" plans are being cancelled you are incorrect.


I answered the question.

The question was "Why are individual plans being cancelled".
The answer is: "Because they are Junk plans that don't provide real coverage". Non-partisan groups such as Consumer Reports are saying as much.

You state (without evidence) that the cancelled plan was "excellent". So I think it is fair for me to ask, how was it excellent?

To prove that it is not a junk plan, please give details. What was the deductible? What were the coverages? And most importantly was there an annual or lifetime cap on coverage?

If this particular plan is not one of the junk plans that are causing problems, then by all means prove me wrong. But you can't just assert that it was "excellent" to score your partisan political points without providing anything to back it up.
JPB
 
  3  
Reply Fri 13 Dec, 2013 09:00 am
@maxdancona,
Actually, my husband's employer-provided not junk plan was cancelled too. It was nonconforming because the OOP max for the family plan was three times the individual deductible and the ACA limits it to two times. Nearly every policy in the land used to use 3 times the individual limit on a family policy. Other people I know with not junk policies got the letter because they didn't have maternity coverage in their plans which all plans must now have regardless of the age (sex?) of the insured. They're also now required to cover some pharmaceuticals that they'd previously disallowed.

The insurance companies took these nuances and cancelled many, many plans that were just fine, but less profitable, and rewrote them in a way that a) increased the deductibles so that 2 times the individual deductible was closer to the previous 3 times the individual deductible and b) increased the copay on meds to offset the cost of the third tier of meds.

We're one of the lucky ones. Our silver plan covers less but also costs less. What was an 80/20 plan with a $30 OV copay and $3000 deductible for $1700/month will become a 90/10 plan with the same $30 OV copay and a $2000 deductible at $1400/month. The out-of-network coverage is now zero, however, for both inpatient services and outpatient. Drug copays are much higher.

edit: the plan recommended by the insurance company was a 70/30 plan with $50 OV copays and a $3000 deductible for $1350/month. Because it's a small company we were able to have input into which replacement plan was chosen and requested the 90/10 plan.
JPB
 
  1  
Reply Fri 13 Dec, 2013 09:05 am
@RobertW,
I'm seeing similar stories from people in MA, which surprises me since MA is supposed to be the model state for all of this. Our policy is based out of NY which was notoriously expensive previously.

Quote:
However, a friend of mine (granted, an Obamaton) told me that the law permits "non-conforming" grandfathered plans, but the insurance companies are using ObamaCare as an excuse to terminate less-than-profitable plans.


I think this is a large part of it. They're also allowed to sell non-grandfathered plans for another year, but very few companies are doing that. The plans as rewritten will guarantee that their profits aren't impacted. In fact, I think you'll be seeing record profits reported by insurance companies in 2014. (And, I'm no Obamaton).
jespah
 
  1  
Reply Fri 13 Dec, 2013 09:29 am
@JPB,
Some of this seems to be happening when states have set up their own exchanges (I don't purport to be an expert on this at all). And this is wacky because, yeah, Mass. has had a connector longer than anyone else (since '06) -
http://boston.cbslocal.com/2013/09/16/qa-top-questions-answered-about-how-the-aca-affects-massachusetts/
0 Replies
 
JPB
 
  2  
Reply Fri 13 Dec, 2013 09:56 am
@JPB,
One point, however, that max makes and is an important component is the lifetime max that is no longer allowed, nor can an insurance company drop you if you become ill. We're all going to pay for that - as we should. I'm much more upset at the profit motive of the insurance companies than I am about the actual cost of increased security.
0 Replies
 
Jack of Hearts
 
  2  
Reply Fri 13 Dec, 2013 05:23 pm
@RobertW,
Your friend is correct, insurance companies could have more easily put a rider, or an 'amendatory endorsement' on any existing policy. (I get them all the time on my State Farm policy.)
Just follow the money - under the guise of Obamacare, insurance companied dropped all the 'grandfathered' policies they could - and why not, the profit margin is not just there.
That, " I have read that the law was deliberately written to force the cancellation of individual plans." is just not true - check your sources. Obama screwed up on that, and made promises he couldn't keep - he assumed the policies would be amended, not canceled.
Millions more customers, increased premiums, many more with govt subsidies - follow the money.
stan8211
 
  2  
Reply Fri 13 Dec, 2013 05:38 pm
@maxdancona,
My plan was cancelled and it definitely was not a junk plan. It got me through Mantle Cell Lymphoma treatment including a complete stem cell replacement. It had a zero deductible and $1500 per year cap with no limits. When I spoke to them, I was told it was non-conforming due to maternity care. Being a 61 year old male, I did not think that was important, but obviously the wonks in D.C. know better.
maxdancona
 
  1  
Reply Fri 13 Dec, 2013 05:51 pm
@stan8211,
A $1500 per year cap. Are you kidding? That is incredibly bad. Didn't your treatment cost more than $1500?
JPB
 
  1  
Reply Fri 13 Dec, 2013 06:08 pm
@maxdancona,
No, max, his annual out-of-pocket cap was $1500 with no maximum annual benefit. His policy was canceled because it didn't offer maternity coverage - even though he would never need such coverage. This happened to many people. That's the kind of bs the insurance companies pulled in order to kill good plans and replace them with plans that cost a lot more and offer less. The plans that were canceled weren't all 'junk'.
0 Replies
 
RobertW
 
  1  
Reply Fri 13 Dec, 2013 06:10 pm
@maxdancona,
I'm not sure if you are buying into the party line or shilling for it. If a plan meets my family's needs and we can afford it, it is by definition not a "junk" plan. However, in my case it was a platinum plan which I've had for ten years which I'd never be able to buy today (even forgetting about ObamaCare).
What I am trying to understand is whether the insurance companies are just taking advantage of the situation, or whether the law was written to deliberately force cancellation of these plans. Reading between the lines it sounds like you are saying it is the latter?
0 Replies
 
RobertW
 
  1  
Reply Fri 13 Dec, 2013 06:21 pm
@Jack of Hearts,
Quote:
Your friend is correct, insurance companies could have more easily put a rider...


Thanks for the reply. Are you able to substantiate that by siting the law (I know that is a tall order), or are you giving your opinion? It seems that some other responders are maintaining the opposite.

One thing that is unquestionable is that Obama knew this was coming three years ago and just completely lied about it. The question is, did he know that they might get cancelled (insurance company greed) or that they would get cancelled (government mandate). And is there any way to substantiate it?

If it is, as you say, just insurance company greed, why the last minute scramble in congress to try to change the law to permit these grandfathered plans to continue?
0 Replies
 
maxdancona
 
  0  
Reply Fri 13 Dec, 2013 06:45 pm
I am sorry, but I am very skeptical of these stories. I accept that some people will have to pay a little more, but there are also people who are paying for insurance policies that are scams.

The stories about people who had these super plans for very little money are probably one of two things.

1. People think they were getting a good deal for almost no money, but whose insurance policies didn't really cover them.

2. People who are making up stories to score political points.

I am sure that there are some people who are losing out over these plans-- but they aren't losing out nearly as much as these stories suggest. People who are losing plans that are "too good to be true" have probably been mislead.

Compare this to the people who are getting insurance for the first time, or are replacing these plans that are not worth their low cost, I think this story line is way overblown.
JPB
 
  2  
Reply Fri 13 Dec, 2013 07:33 pm
@maxdancona,
I don't think the OP came here to convince you one way or the other. He seems sincere in asking a question. He has an anecdote, I have an anecdote, others have anecdotes and they add up to a story. My take on the story is that we should have done it right from the outset and gone with a single-payer system. His question is trying to understand the intent of the law.

RobertW - yes, there was specific intent to prevent 'junk' policies from being sold as of January 2014. There was a specific intent to allow policies that hadn't substantially changed between 2010 and 2013 to remain on the market. The gov't underestimated the reaction from the insurance agency who changed the policies between 2010 and 2013 and then had to void them under the law as insufficient to the requirements of the ACA. As someone said above - follow the money.
maxdancona
 
  1  
Reply Fri 13 Dec, 2013 08:44 pm
Robert, let me ask you a simple question that will go a long way to answer my suspicions about where you are coming from with this thread.

(this is a question just for Robert)

In what country was Barack Obama born?
JPB
 
  3  
Reply Fri 13 Dec, 2013 10:57 pm
@maxdancona,
jesus, max, quit being such an ass.
maxdancona
 
  1  
Reply Fri 13 Dec, 2013 11:07 pm
@JPB,
I don't think I am. Read the original post again...

Quote:
Like a fool I believed the "if you like your plan you can keep it"

Quote:
I have read that the law was deliberately written to force the cancellation of individual plans, including grandfathered ones.

Quote:
a friend of mine (granted, an Obamaton)

Quote:
I'm not sure if you are buying into the party line or shilling for it.

Quote:
Obama knew this was coming three years ago and just completely lied about it.


I smell a sock puppet....
JPB
 
  1  
Reply Fri 13 Dec, 2013 11:20 pm
@maxdancona,
I think you're reacting to the use of the word "Obamaton". It puts a spin on his posts that would be innocent without it.
 

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