Your canceled health plan: What can you do?

Obama's health act change may help you salvage your lost coverage

President Barack Obama's plan to allow people to keep their canceled health plans for another year has raised some nagging questions. Here are some answers.

Q: Under the president's new directive, can everybody keep his or her old individual or small-group plan?

A: Maybe not. It's up to the insurers whether to renew them or not. And even if they do, the final word will come from state insurance commissioners, who will decide whether to permit the renewals. Oregon's commissioner has decided to admit the renewals.

Q: Won't the Republican bill that passed the House of Representatives on Friday do the same thing as the changes that the president announced Thursday?

A: Not quite. In addition to allowing current policyholders to keep their noncompliant plans, the House bill would permit new customers to buy the old policies. Obama administration officials say that provision would undermine the law.

Q: How can the president keep changing terms of the Affordable Care Act without the approval of Congress? Is that legal?

A: Yes. The Department of Health and Human Services used its "enforcement discretion," which allows it to mend or alter policies that ease the transition of a substantial change in the law. The administration did the same thing last year by delaying enforcement of the law's employer mandate.

It used the same authority in 2012 when it established the Deferred Action for Childhood Arrivals program, which gave the government discretion not to deport immigrants — pending changes in immigration rules — who either were brought to the United States as children or meet other specific requirements.

Q: What individual and small group plans are encompassed by the president's health policy renewal offer?

A: According to the Centers for Medicare and Medicaid Services, current individual and small group policies with renewal years that start between Jan. 1 and Oct. 1, 2014, won't be required to meet the beefed-up coverage standards and consumer protections required under the Affordable Care Act.

Q: Does that mean some people will be able to keep their current individual and small group plans as late as Oct. 1, 2015?

A: Yes, they can keep it, as long as the insurance company maintains the plan that long.

Q: For people who want to renew their canceled plans, Obama said insurers had to inform them about the health care law. What exactly are insurers required to disclose?

A: They must tell policyholders facing cancellation about changes in the options available to them. These might include provisions that won't be available in their old policies, their right to enroll in coverage through the online insurance marketplace and the possibility of financial assistance to help them do so. They also will be told how to obtain marketplace coverage and that they can get non-marketplace coverage that also meets the law's new benefit requirements.

Q: What features will the 2014 marketplace plans have that the renewable canceled plans won't?

A: A number of consumer protections and coverage enhancements, including access to coverage regardless of current or past health problems; benefits that cover at least 60 percent of medical costs; limited out-of-pocket costs, such as co-payments and deductibles; no annual or lifetime benefit spending limits; no rate variances based on gender, occupation or medical claims history; and required coverage of 10 benefits that include mental health services, prescription drugs, pediatric services, and maternity and newborn care.

Q: If these new policies are so much better, wouldn't the market dictate that they would become more popular and people would gravitate to them naturally? Why do we need an "individual mandate" that forces people to have this coverage?

A: Without the individual mandate, the law's expanded coverage and new consumer protections would cause monthly premiums to skyrocket. That's because they would encourage older, sicker people to get coverage, and they're much more costly to insure. Meanwhile, younger healthy people might wait until they get sick to buy insurance. The individual mandate discourages that behavior by promoting a mix of healthy and sicker people to get coverage. That diversity of enrollees keeps premium costs down.


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