Pa. insurer extends discount health plan in response to disruption, confusion

Pennsylvania residents currently enrolled in a discount health plan geared toward low-income residents, which had been slated for cancellation at the end of next month, will now have the option to continue with that coverage through June. The cost of the plan, however, may go up.

Special Care is a “guaranteed issue” individual health insurance policy offered through Blue Cross plans across the state. It provides limited benefits to people with low incomes regardless of their health status.

Danielle Gatto, a bar and restaurant manager, is one of about 6,000 Philadelphians with the policy. She enrolled after losing her public health coverage in 2011. The policy costs her about $150 a month and covers no more than four doctor’s visits a year.

“It’s not necessarily ideal for me because it doesn’t cover the medical treatment I need,” says Gatto, who has Crohn’s disease. “But it does cover the emergency care which I need.”

Special Care was in part a response from Blue Cross and the state to a previous lack of options for people like Gatto.

“It sort of was one of those insurance policies that filled a gap for folks that couldn’t obtain insurance other ways, prior to the Affordable Care Act,” says Ann Bacharach, a special projects director at the Pennsylvania health law project.

But starting next year, insurers can’t reject anyone due to pre-existing conditions or charge them significantly more. All plans must also include certain benefits.

In response, many insurers have issued cancellation notices for plans on the individual market which don’t meet those new standards. Special care is one of them, and while Gatto does not love her plan, being forced to change coverage has been stressful.

“It just sort of made my head spin to try and figure out these numbers and make them fit my actual life,” she says. Additionally, Gatto hasn’t identified a new plan which would cover the medication she needs.

A change in course

President Obama then announced two weeks ago that insurers could extend those health plans into next year, even if they don’t meet the new standards.

While the cancellations have caused “major disruption in the health insurance marketplace for hundreds of thousands of consumers,” Pennsylvania Health Insurance Commissioner Michael Consedine wrote in a statement, the president’s most recent decision “has created even more confusion for consumers.” Consedine’s department is asking insurance companies to now reach out to policyholders and let them know their options.

In this region, the decision whether to rescind cancellations rests with insurers, and on Tuesday, Blue Cross agreed to renew Special care for another six months, meaning that Gatto and others can keep their coverage for now. The company, however, is requesting a rate increase from the state’s insurance office.

“Given the uncertainty among individual consumers about the changes in health care coverage required by the Affordable Care Act and the challenge many have faced trying to enroll through the online federal marketplace, Independence Blue Cross is offering options to roughly 24,000 individual policyholders that will simplify enrollment and avoid gaps in coverage,” the company wrote in a statement.

Bacharach, with the health law project, says extensions aside, it’s still worth checking out new options through the new health care marketplace, which take effect as early as January first.

“Even a bronze plan [in the new marketplace] will cover more visits, more prescription drugs, more days in the hospital than the current Special Care plan, which was designed under a whole other set of circumstances,” she says.

Bacharach also says that while the process can be overwhelming, designated insurance counselors can help, as can going directly to insurers’ websites to get more details on the plans.

For those 17,000 people with other “guarantee enrollment” plans through Blue Cross, slated for discontinuation come January, they can either choose a new plan themselves or the company will select a replacement plan for them instead, automatically changing over the coverage in January. But the company, the insurance department and the Obama administration are encouraging policy holders look for options on their own through the new marketplace, as they may be eligible for financial assistance.

This disclosure, Independence Blue Cross supports WHYY.