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Hamm: Renew policies; Insurance commissioner asks companies to renew cancelled policies

North Dakota Insurance Commissioner Adam Hamm

BISMARCK — North Dakota Insurance Commissioner Adam Hamm said Thursday he is asking the state’s health insurance companies to renew policies for customers who want to keep their current health plans that otherwise would be cancelled by the Affordable Care Act.

Now, the question is, will they?

Nearly 36,000 North Dakotans were among the millions of Americans who recently received notices that they would be losing their existing health insurance plans because they don’t meet the ACA’s new coverage standards that begin to take effect Jan. 1.

President Barack Obama responded to criticism by announcing last week an administrative fix that allows insurers to give affected customers the option of renewing their plans for 2014 in states that permit it.

Hamm announced his decision Thursday morning to allow companies to extend the plans.

“It was a close call, but at the end of the day, I wanted to make sure if there was some temporary relief that could be provided to the almost 36,000 North Dakotans impacted by this issue, that they could get that relief,” he said in a phone interview.

Among North Dakota’s three major health insurers, 31,600 customers of Blue Cross Blue Shield received cancellation notices, as did 3,173 Medica customers and 812 Sanford Health Plan customers, Hamm said. Plans facing cancellation aren’t eligible for the Affordable Care Act’s “grandfather clause” exemption either because they were purchased after the act was signed into law on March 23, 2010, or because a major change was made to the plan.

Neither federal nor state officials have the authority to compel companies to extend coverage, but Hamm said he’s asking them to do it.

“They have their own analysis that they have to do and a hard decision to make, because at the end of the day, these 36,000 people are their customers,” he said. “This is a real-world impact, not just for these 36,000 people but for these companies involved.”

In a statement, Blue Cross Blue Shield of North Dakota said it is “evaluating the impact of this option on our members.”

As of 5 p.m. Thursday, Medica and Sanford had not provided responses to Hamm’s decision.

The president’s suggestion that insurers can extend individual coverage is not a real solution and might not be workable, Hamm said. Insurers have expressed concerns about practical challenges in extending coverage once slated for cancellation. There also are concerns about the actuarial soundness of extending coverage, he said.

A final solution would require Congress and the president to amend the Affordable Care Act to make good on Obama’s promise that those who like their current health care plan can keep it, Hamm said.

However, he acknowledged that such an amendment would likely result in not enough people buying policies through the Health Insurance Marketplace to keep Obamacare afloat. And that wouldn’t bother Hamm, who said his position on the law hasn’t changed since it was approved in 2010.

“It does need to be replaced with true health care reform that focuses on containing costs and making health insurance more affordable,” he said. “If this is the straw that breaks the camel’s back, then that’s the consequence of the president making the promise that he made. It certainly isn’t the fault of the policyholders. They’ve done nothing wrong.”

Also on Thursday, the White House announced that in an attempt to clear up confusion created by cancellation notices, insurance companies that decide to let customers renew their existing plans will now be required to send them a letter clearly stating that they have the option to buy coverage through the marketplace, where they may qualify for tax credits or other financial assistance. The letters also will explain what protections customers would be giving up to keep the plan they have.

“In short, they give consumers the information they need to make the best choice, which may be keeping their old plans,” a White House Blog post stated.

Three things for policyholders to consider

The North Dakota Insurance Department says consumers whose health insurance plans have been or will be canceled as a result of the Affordable Care Act should consider the following before deciding to renew their existing plan for 2014 if their insurance company allows it:

* The benefits of the renewed plan will be the same, but costs could increase.

* If there is a pre-existing condition exclusion or other limitations in the current plan, those will still exist.

* The level of benefits and other requirements in a renewed plan may not be as comprehensive as plans being sold effective Jan. 1, 2014, that comply with the Affordable Care Act.

Consumers who received cancellation notices are advised to contact their insurance companies for more information.

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