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 The government has sought to reassure consumers, already
frustrated by technical problems that stalled access to its
HealthCare.gov enrollment website in October and November, that
those who need coverage starting on New Year's Day will be able to
sign up.
Last week, the administration appealed to the insurance industry to
accept people who sought benefits past the December 23 enrollment
deadline for January 1, and to consider approving retroactive
coverage for consumers who signed up during the month of January.
So far, the answer has amounted to a big "maybe."
Insurers are worried that some consumers will sign up for
retroactive January plans only if they have incurred a hefty medical
bill. It is unclear what the costs of that would be or how many
shoppers might take advantage of the policy.
"It creates a situation where someone might be able to apply for
insurance when they have already had services" such as in the
emergency room, said Mary Beth Chambers, spokeswoman for Blue Cross
Blue Shield of Kansas. "It's like calling for homeowners insurance
when your house is already on fire."
Chambers said that such cases would probably be "few and far
between."
BCBS of Kansas, the largest insurer in a state where about 14
percent of the population is uninsured, has decided to give people
until January 10 to pay their premiums and receive retroactive
coverage beginning January 1. They are still hewing to the December
23 enrollment deadline while they study the feasibility of allowing
retroactive sign-ups as late as January 31.
Some of these changes and the technical problems associated with the
rollout of the Affordable Care Act, commonly called Obamacare, could
lead to people facing a gap in coverage next month. It could also
create new political problems for President Barack Obama over his
signature domestic policy, which opposition Republicans have tried
to derail for years.
EXTENDED PAYMENT DATE
Aetna Inc, one of the biggest players on the exchange, is going to
extend the payment date until January 8, make service workflow
changes to support the deadline shift to December 23 from December
15 and already planned to ensure customers will not miss important
appointments, such as cancer treatments. But it said some of the
administration's suggestions would require systems changes and more
service support people, which was not viable.
"We are concerned that changing the rules at this late date and
allowing for this degree of variability will lead to significant
consumer confusion about the marketplace," Aetna spokeswoman Cynthia
Michener said.
Cigna Chief Executive David Cordani said the company will decide
this week which measures to pursue. The company, which has only a
small business catering to individuals, said that its employer-based
plans already offer similar programs to ensure continuity of
coverage.
Other insurers, including Molina Healthcare Inc which is selling
Obamacare plans in 9 states, have said they will be extending the
payment deadline but are stopping there.
The request has raised concerns among some Wall Street analysts over
a steady stream of changing regulations. Moody's, which reviews
credit ratings of companies, said the additional conditions are a
negative influence on insurers' business, requiring administrative
changes to track new customers, and will be confusing for doctors
and consumers.
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ENROLLMENT INCREASES BUT STILL LOW
Enrollment in Obamacare plans has picked up in December, due to
fixes for HealthCare.gov, which serves 36 states, and as consumers
nationwide anticipate the December 23 deadline for January 1
benefits. The Congressional Budget Office has estimated that 7
million people will sign up for coverage by the time enrollment for
all of 2014 ends on March 31.
But the pace of enrollments so far — 365,000 people by the end of
November — has cast doubt on the government's ability to reach that
many people in the program's first year.
Wall Street analysts have lowered their estimates for enrollment to
almost half the CBO estimate, or less. Insurers have tempered their
expectations as well. For the larger players like Aetna, WellPoint
and Humana, the exchange market is just a fraction of their total
membership, which range from more than 10 million people to 40
million at UnitedHealth Group Inc.
More than 150 million people receive insurance through their
employers and 100 million others have health coverage through
government programs — Medicare for the elderly and Medicaid for the
poor.
Brian Hale, a senior vice president for health policy at Jackson
Hewitt Tax Service in Nashville, Tennessee, said that he believes
the number of people trying to sign up for January 1 Obamacare
coverage is a fraction of the 10 to 20 million people in the market
for individual insurance this year.
Out of that, the number who may be truly displaced is "a much
smaller number of people then it's been made out to be," Hale said.
Ron Williams, the former CEO of Aetna who now advises private equity
firm Clayton, Dubilier & Rice, said he believed insurers could allow
for retroactive coverage for a few more days in January and still
mitigate the risk of high costs.
"There is some risk there; it is a limited risk," Williams said.
Funding under the healthcare law may help cover some of that risk,
or the costs that come when very sick people sign up at a
disproportionate rate versus healthy people.
Vantage Health Plan in Louisiana is planning to extend the deadline
for people to enroll for January 1 coverage, but has not decided how
long to do so, according to Billy Justice, Vantage's marketing and
sales director.
Justice said that the law prohibits insurers from denying coverage
to someone with a prior illness "and there should be risk
adjustments at the end of the year for insurance companies that get
the highest risk."
(Reporting by Caroline Humer; editing by Michele Gershberg and Grant
McCool)
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