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Regulation to cancel insurance policies wasn't in the ACA?
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| Other Resources | The Political Joe » Regulation to cancel insurance policies wasn't in the ACA? | Rss Feed  |
 2013-11-19 9:27 PM |
Pro  9391     Omaha, NE |  Subject: Regulation to cancel insurance policies wasn't in the ACA?I figured I'd start a fresh thread because this is kind of a big deal, if true. Obviously the website issues are what most people are talking about with the ACA, but the real meat that seems to be swinging public opinion is due to the number of insurance policies being canceled due to the ACA regulations. I've just assumed, along with everyone else that it was part of the ACA law and Obama and others were somewhat misleading with the now infamous statement "if you like your health insurance you can keep it". The Administration is now trying to spin this by saying what they meant was that you could keep your plan if it was in place by the time the law was signed and doesn't change. However, Rand Paul dropped a bombshell over the weekend: “I’m still learning about it. It’s 20,000 pages of regulations. The Bill was 2,000 pages and I didn’t realize this until this week, the whole idea of you losing or getting your insurance cancelled wasn’t in the original Obamacare. It was a regulation WRITTEN BY PRESIDENT OBAMA, three months later. So we had a vote, this is before I got up there. The Republicans had a vote to try to cancel that regulation so you COULDN’T BE CANCELLED, to grandfather everybody in. You know what the vote was? Straight party line. EVERY DEMOCRAT VOTED TO KEEP THE RULE THAT CANCELS YOUR INSURANCE.” So, according to Rand, the regulation to cancel previous policies was written into the law via a "regulation" by the White House three months after the law went into effect and circumventing the congress. The Republicans voted to have the language removed and every Democrat voted to keep the provision in there. This whole thing just gets weirder and weirder. I'm also guessing that these cancellations as well as the other 11,000 pages of Regulations that came after the law was passed wouldn't have been scored into the CBO report which informed us of the costs before the law was passed. |
| 2013-11-20 12:57 PM in reply to: tuwood |
Champion 34263 Chicago | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? So, is there any factual basis to this? Or, do you take Rand Paul at his word? Or do you just believe everything you see on the internet. Seriously, though, it may be true but it's very vague. A few things -- he talks about the `original Obamacare' but to which draft was he referring? When was the alleged vote? Etc. etc. and etc. |
| 2013-11-20 4:01 PM in reply to: 0 |
Expert 1310 Alabama | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? It is my understanding that it was not written in the original law, the way it was eventually interpreted in the regulations. I believe when it was first passed, it was sort of understood that plans would be grandfathered. It was the regulations that were written later, that changed the face of the law and made it almost impossible for insurance companies to "grandfather" a plan into the ACA. Because of the requirements of the regulations and the way a plan had to be structured under the ACA, required changes to a lot, if not almost all plans, which caused the plans to not qualify to be "grandfathered". Whether there was ever a vote or not, I do not know. May have been, or may not have been. I do believe the above is what happened, as I have heard it from a few people in the insurance industry. I imagine, it might affect different states differently, depending on the structure of the insurance plans offered in your individual state. Take it for what it's worth: http://www.dailymail.co.uk/news/article-2509520/Senate-GOP-tried-bl... Edited by pilotzs 2013-11-20 4:06 PM |
| 2013-11-20 5:26 PM in reply to: pilotzs |
Master 4101 Denver | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by pilotzs It is my understanding that it was not written in the original law, the way it was eventually interpreted in the regulations. I believe when it was first passed, it was sort of understood that plans would be grandfathered. It was the regulations that were written later, that changed the face of the law and made it almost impossible for insurance companies to "grandfather" a plan into the ACA. Because of the requirements of the regulations and the way a plan had to be structured under the ACA, required changes to a lot, if not almost all plans, which caused the plans to not qualify to be "grandfathered". Whether there was ever a vote or not, I do not know. May have been, or may not have been. I do believe the above is what happened, as I have heard it from a few people in the insurance industry. I imagine, it might affect different states differently, depending on the structure of the insurance plans offered in your individual state. Take it for what it's worth: http://www.dailymail.co.uk/news/article-2509520/Senate-GOP-tried-bl... What I've heard is that many of the plans getting cancelled are being cancelled not because the ACA is forcing them to be cancelled (plans only have to start meeting the ACA requirements if they're sold after Jan 1, 2014, so a company could renew a plan today for all of 2014 with pre-ACA coverage no problem if they want to and I think Obama extended that to 2015 after the crap-storm) but because they become money-losers under ACA. My understanding is that most of the plans getting cancelled are cheap, no frills plans that don't cover much unless something bad happens. The way it works now is that when something bad happens the insurance company finds some pretext to drop you so they don't have to cover all big, unusual expenses or make it so hard that you give up. However, under ACA, they're no longer allowed to find these flimsy pretexts and drop people (coverage of preexisiting conditions means they have to cover you no matter what) so suddenly all these cheap plans that make money for the insurance companies because they can find a way to drop you if something expensive happens become uneconomical to offer if they have to honor all the coverage, so they're cancelling them. That's what I've heard anyway, I'd be interested to hear if your friends in the industry say the same thing or if that's a load of bunk.
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| 2013-11-20 6:02 PM in reply to: 0 |
Expert 1310 Alabama | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by drewb8 Originally posted by pilotzs It is my understanding that it was not written in the original law, the way it was eventually interpreted in the regulations. I believe when it was first passed, it was sort of understood that plans would be grandfathered. It was the regulations that were written later, that changed the face of the law and made it almost impossible for insurance companies to "grandfather" a plan into the ACA. Because of the requirements of the regulations and the way a plan had to be structured under the ACA, required changes to a lot, if not almost all plans, which caused the plans to not qualify to be "grandfathered". Whether there was ever a vote or not, I do not know. May have been, or may not have been. I do believe the above is what happened, as I have heard it from a few people in the insurance industry. I imagine, it might affect different states differently, depending on the structure of the insurance plans offered in your individual state. Take it for what it's worth: http://www.dailymail.co.uk/news/article-2509520/Senate-GOP-tried-bl... What I've heard is that many of the plans getting cancelled are being cancelled not because the ACA is forcing them to be cancelled (plans only have to start meeting the ACA requirements if they're sold after Jan 1, 2014, so a company could renew a plan today for all of 2014 with pre-ACA coverage no problem if they want to and I think Obama extended that to 2015 after the crap-storm) but because they become money-losers under ACA. My understanding is that most of the plans getting cancelled are cheap, no frills plans that don't cover much unless something bad happens. The way it works now is that when something bad happens the insurance company finds some pretext to drop you so they don't have to cover all big, unusual expenses or make it so hard that you give up. However, under ACA, they're no longer allowed to find these flimsy pretexts and drop people (coverage of preexisiting conditions means they have to cover you no matter what) so suddenly all these cheap plans that make money for the insurance companies because they can find a way to drop you if something expensive happens become uneconomical to offer if they have to honor all the coverage, so they're cancelling them. That's what I've heard anyway, I'd be interested to hear if your friends in the industry say the same thing or if that's a load of bunk.
I don't think what you said is total bunk, but it's not entirely accurate (from my understanding). I'll be the first one to tell you that I'm no expert, but I have talked to a lot of people and tried to figure out the ACA as much as possible as I'm an employer. When we met with our insurance carrier, they basically told us that we cannot keep our current plan, because it doesn't qualify under the ACA approved plans, as they are currently written, and how they are pooled for costing. To have an approved plan under the ACA, they have to change to specific plans, covering specific items, which have to fall into prescribed plan types (60/40, 70/30, 80/20 & 90/10 plans), which have to be costed on nothing other than age, whether you smoke or not and where you are employed/live. I can assure you, in our state, that we don't have a "no frills" plan at my office (we probably have the equivalent of an 80/20 plan under the ACA). I can also assure you that my family (through my wife's employer) doesn't have a "no frills" plan through BCBS, which covered basically everything we needed for our family for 11, going on 12 years now, which they may have to drop because of pricing. We have also talked with an outside consultant on what to do as an employer and what it means to us, etc. and he basically said the same thing as our rep, and that the regulations were written in such a way, it was impossible for BCBS to keep the current plans that they had for employers (BCBS has about an 80% market share in Alabama and worked very effectively here). So, In essence, the regulations were written so stringently, that even if you have a good plan (that you liked) which was not a "no frills" plan, is going to get cancelled, because it cannot be "grandfathered", because there was no way to have that happen under the regulations. Now, all that being said, our insurance isn't "being cancelled", because we can renew, but our old plan is effectively being cancelled, which we will be allowed to renew under the new ACA approved plans. As an employer, I'm still not sure what this means for us yet, but from what I can tell, it's not going to be good. It's also especially not going to be good for our 26-40 year old age groups, as they will see the largest increases. Whether we can afford the increases remains to be seen as an employer and our employees. What we are going to be forced into, is offering a 60/40 plan (which is worse than what we had, way worse) because we have to meet the affordability test under the ACA. So, our employees will no longer have the insurance that they had previously, and will end up with worse insurance as a result. Of course, we can offer an 80/20 plan or 90/10 plan, but they are not going to be able to afford those plans, and we may not be able to either. I'm not sure if any of this makes sense, as it's my understanding. I'm sure someone in the industry, or in the legal field dealing with healthcare can explain it much better. Edited by pilotzs 2013-11-20 6:03 PM |
| 2013-11-20 6:14 PM in reply to: pilotzs |
Master 4101 Denver | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by pilotzs
I don't think what you said is total bunk, but it's not entirely accurate (from my understanding). I'll be the first one to tell you that I'm no expert, but I have talked to a lot of people and tried to figure out the ACA as much as possible as I'm an employer. When we met with our insurance carrier, they basically told us that we cannot keep our current plan, because it doesn't qualify under the ACA approved plans, as they are currently written, and how they are pooled for costing. To have an approved plan under the ACA, they have to change to specific plans, covering specific items, which have to fall into prescribed plan types (60/40, 70/30, 80/20 & 90/10 plans), which have to be costed on nothing other than age, whether you smoke or not and where you are employed/live. I can assure you, in our state, that we don't have a "no frills" plan at my office (we probably have the equivalent of an 80/20 plan under the ACA). I can also assure you that my family (through my wife's employer) doesn't have a "no frills" plan through BCBS, which covered basically everything we needed for our family for 11, going on 12 years now, which they may have to drop because of pricing. We have also talked with an outside consultant on what to do as an employer and what it means to us, etc. and he basically said the same thing as our rep, and that the regulations were written in such a way, it was impossible for BCBS to keep the current plans that they had for employers (BCBS has about an 80% market share in Alabama and worked very effectively here). So, In essence, the regulations were written so stringently, that even if you have a good plan (that you liked) which was not a "no frills" plan, is going to get cancelled, because it cannot be "grandfathered", because there was no way to have that happen under the regulations. Now, all that being said, our insurance isn't "being cancelled", because we can renew, but our old plan is effectively being cancelled, which we will be allowed to renew under the new ACA approved plans. As an employer, I'm still not sure what this means for us yet, but from what I can tell, it's not going to be good. It's also especially not going to be good for our 26-40 year old age groups, as they will see the largest increases. Whether we can afford the increases remains to be seen as an employer and our employees. What we are going to be forced into, is offering a 60/40 plan (which is worse than what we had, way worse) because we have to meet the affordability test under the ACA. So, our employees will no longer have the insurance that they had previously, and will end up with worse insurance as a result. Of course, we can offer an 80/20 plan or 90/10 plan, but they are not going to be able to afford those plans, and we may not be able to either. I'm not sure if any of this makes sense, as it's my understanding. I'm sure someone in the industry, or in the legal field dealing with healthcare can explain it much better. Very interesting, thanks. And good luck too. |
| 2013-11-21 8:51 AM in reply to: mr2tony |
Pro 9391 Omaha, NE | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by mr2tony So, is there any factual basis to this? Or, do you take Rand Paul at his word? Or do you just believe everything you see on the internet. Seriously, though, it may be true but it's very vague. A few things -- he talks about the `original Obamacare' but to which draft was he referring? When was the alleged vote? Etc. etc. and etc. I honestly don't know. I tried searching for various language in the law and the regulations, but I'm sure you can guess how easy that was. lol |
| 2013-11-21 9:05 AM in reply to: tuwood |
Master 1584 Fulton, MD | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Pet Peeve based on definitions - No REGULATION was in the ACA. Laws passed by Congress are laws / statues. Federal regulations are an explanation of how the executive branch interprets that law. |
| 2013-11-21 9:09 AM in reply to: drewb8 |
Pro 9391 Omaha, NE | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by drewb8 Originally posted by pilotzs It is my understanding that it was not written in the original law, the way it was eventually interpreted in the regulations. I believe when it was first passed, it was sort of understood that plans would be grandfathered. It was the regulations that were written later, that changed the face of the law and made it almost impossible for insurance companies to "grandfather" a plan into the ACA. Because of the requirements of the regulations and the way a plan had to be structured under the ACA, required changes to a lot, if not almost all plans, which caused the plans to not qualify to be "grandfathered". Whether there was ever a vote or not, I do not know. May have been, or may not have been. I do believe the above is what happened, as I have heard it from a few people in the insurance industry. I imagine, it might affect different states differently, depending on the structure of the insurance plans offered in your individual state. Take it for what it's worth: http://www.dailymail.co.uk/news/article-2509520/Senate-GOP-tried-bl... What I've heard is that many of the plans getting cancelled are being cancelled not because the ACA is forcing them to be cancelled (plans only have to start meeting the ACA requirements if they're sold after Jan 1, 2014, so a company could renew a plan today for all of 2014 with pre-ACA coverage no problem if they want to and I think Obama extended that to 2015 after the crap-storm) but because they become money-losers under ACA. My understanding is that most of the plans getting cancelled are cheap, no frills plans that don't cover much unless something bad happens. The way it works now is that when something bad happens the insurance company finds some pretext to drop you so they don't have to cover all big, unusual expenses or make it so hard that you give up. However, under ACA, they're no longer allowed to find these flimsy pretexts and drop people (coverage of preexisiting conditions means they have to cover you no matter what) so suddenly all these cheap plans that make money for the insurance companies because they can find a way to drop you if something expensive happens become uneconomical to offer if they have to honor all the coverage, so they're cancelling them. That's what I've heard anyway, I'd be interested to hear if your friends in the industry say the same thing or if that's a load of bunk.
I'm very far from an expert on insurance plans as well, but I can speak to my company. I only have 8 employees, but my insurance is on a group plan with my company and my business partners other company so we have a combined 48 employees. We have an HSA plan currently that has a $3000 deductible and then shifts to 80/20 with a maximum out of pocket of $6000 per year. I'm not sure what my individual monthly premium is per month, but it's fairly cost effective and somewhere in the neighborhood of $500-$600 per month for a family of 5. My business also contributes $250/mo. into the HSA account so total company cost is lets say $800 and it results in essentially free insurance for everyone. If an individual has a large event their max out of pocket would be about $2500 due to the HSA, but in reality most of my employees have upwards of $10k in their HSA accounts due to being healthy. Our plan is through United Healthcare and doesn't offer routine check ups for free and a few other mandatory items related to the ACA so the plan is going away. It's very far from a no-frills plan because I've yet to see anyone not get covered for anything. As a business we've had several surgeries, broken bones, and even a heart condition and everything was covered. So, I think the premise that only no-frills plans that don't meet minimum requirements are being canceled isn't accurate. From what I've read it's near impossible for any plan to be compliant due to the nature of the regulations. In our case, we have outstanding insurance that everyone desperately wants to keep. Our current situation is better than the best Gold plan you can buy on the exchange and it's very cost effective for me as a business. I still haven't seen the full rates for next years plans, but everything I'm hearing is we will have to switch to a plan that has higher deductibles, that costs more. So, the net is, everyone is going to have to pay more out of pocket for no additional benefit. |
| 2013-11-21 10:02 AM in reply to: jcnipper |
Pro 9391 Omaha, NE | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by jcnipper Pet Peeve based on definitions - No REGULATION was in the ACA. Laws passed by Congress are laws / statues. Federal regulations are an explanation of how the executive branch interprets that law. Agree, I could have probably stated it a little better. |
| 2013-11-25 12:25 PM in reply to: tuwood |
Extreme Veteran 1190 Silicon Valley | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Interesting reading here. I am much closer to an expert I think than most here. I do make my living in the health insurance space. Let me share some of my thoughts. 1) The bill that was passed was grossly devoid of specificity. Hence the thousands of pages of regulations, some of which are still being written. 2) What changed post passage was the date for grandfathered plans. There was no specific date in the bill. It was added later and made retroactive to the passage date. Not part of the original legislation. 3) Contrary to law and precedent, the administration has made numerous changes to the law without any vote of any kind. The CLASS Act component of the bill was dropped completely. This was good because it would have been a disaster and both sides agreed it needed to go. Still, no vote to do so. Similarly the decision to grant another year for implementation for big business and last weeks announcement to allow carriers to continue cancelled plans for another year were done so by the president unilaterally without any vote. Last time I checked if you wanted to change a law it required a bill change voted on by the appropriate bodies. 4) The declaration by the president last week to allow companies to extend cancelled policies for another year was a political ploy to shift blame to the insurance companies. First he state departments of insurance has to allow the extension. The CA DOI has not done so. For the states where they will allow it, many carriers can not because they have already set plans in place over the past several years to leave the business. Aetna for example here in CA is leaving the state for individual plans. Every individual and family policy in the state was cancelled. Many of those people, all of which were notified last summer of the cancellation, have moved to an exchange plan. That leaves too few insured to maintain an acceptable risk. BTW - here in CA individual and family coverage for my clients is running on average 40% higher with higher deductibles and higher out of pocket maximums then they have now. 5) The plan designs here in CA are NOT providing better coverage than the high deductible plans the president attacked so vehemently in the campaign. The cheapest bronze plan here has a $6350 deductible for a single person and $12,700 for a family. That is higher than any deductible available in the state today. If my wife and I were to switch to the cheapest plan available in 2014 our premium would ride from $589 to $1132.44. a) So what do I get for the extra $6500/year in premium increase? They pay for my wife's mammogram which we pay for now and two office visits are $50 instead of the negotiated price. That represents a savings of about $400. b) So what do I lose? Subtracting the $400 savings above from the premium increase I lose $6100/year in net premium increase. My deductible rises from $9000 to $11,200. My max out of pocket rises from $11,000 to $12,700. My generic drugs which cost me $4/month will rise to $19/month. So should something big happen to me like it did this year when I was hit by a car while cycling my additional expense would be $6100 net in premium + an additional $1700 in max out of pocket = $7800 a year more in expenses. Where is the Affordable in the Affordable Care Act. 6) A few more changes. I run a small business and reimburse my employees for their individual medical premiums and all out of pocket expenses up to the limit of their medical coverage. I try to be very generous. Under the new rules I can no longer reimburse my employees for individual insurance premiums. I can only pay for their coverage if I move them all to a small group plan. The will mean everyone must be on the same carrier's plan (no they can not pick what they want) and I will have to pay 25% more for the privilege. Second, if I want to continue to reimburse for out of pocket expenses I CAN NOT set a limit to what their plan out of pocket max is. All HRA plans must provide UNLIMITED benefits. So if an employee wants to have cosmetic surgery, I have to pay for it. If they want to have their teeth capped for $10,000, I have to pay for it. Consequently I have to stop paying for anything. All I can do is increase their wages and let them fend for themselves. 7) One BIG issue most people are not talking about. The lower reimbursements being paid by these policies to providers has had a big impact on provider participation. Just because you have an Anthem PPO today and move to an Anthem PPO under obamacare don't think all your doctors are going to take the new insurance. I am checking provider networks for my clients as we try to find a good plan for them. So far I am finding that my clients are losing 40% of their providers on the new PPO plans or 75% of their providers under an HMO plan. Think of the surprise when you go to your doctor you have seen for years and he tells you sorry, I don't take that insurance. Let me make one final statement. I am clearly against this legislation. They applied a political solution to a business issue and it has failed to provide better coverage for the 275 million Americans that had coverage, is not more affordable and if history is any indication, will fail under its own weight just as most entitlement programs have. It has however met the presidents objective of redistribution of wealth. |
| 2013-11-25 1:30 PM in reply to: Stuartap |
Pro 9391 Omaha, NE | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Excellent information. Thanks |
| 2013-11-26 3:56 PM in reply to: tuwood |
Elite 6387 | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? This honestly scares me... of what government regulation looks like in this partisan atmosphere and an ever expanding Federal government. I can understand that Social Security did not start out the same way, but decades later probably has 10s of thousands of pages of regulations. But for the ACA to start out that way, with 10s of thousands of pages added after the vote blows my mind. Especially when it SEEMS that it is fundamentally different that what was proposed in the first place. It absolutely is no secret some want single payer. It was discussed at the time. It is what essentially was proposed at first, but watered down. So it isn't like it is a secret. If all the ACA was to begin with was insuring those that did not have it, and cover preexisting conditions, and decouple it from work... then so be it. I for one came around to the need to deal with the uninsured, and can agree preexisting conditions need to be covered, even if that means health CARE, and not health INSURANCE. But what it is turning into overnight seems to be exactly what it was not supposed to be... single payer. By the government rigging the rules, they are forcing migration.. NO, IT IS NOT A CHOICE. They are forcing migration by regulation, and by price setting. Insurance companies are forced to drop plans, and employers are ENCOURAGED through pricing to pay the fines and dump their employees into the exchanges.... solely by pricing and fine amounts.
All I am asking, is where was all this during the debates for this thing? Sure, I can actually accept that Obama didn't "lie" when he said we can keep our coverage. That "he" didn't cancel anyone, but insurance companies did. OK, but the regulations are written to force them... that is not what was sold to the American people. How in the heck can anyone think this is right that Washington can write what ever they want and mislead the public on what they are doing? How can you possibly stand for that... even if you do agree with what the ACA was attempting to do? |
| 2013-11-26 5:05 PM in reply to: powerman |
| New user 900 , | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Well, at least here on BT, there were a couple of us that said these exact things would happen. During that many page debate, the majority said we were wrong and didn't know what we were talking about. But alas........... Anyway, the dems lied to sell this turd to the American people, knowing full well what was going to happen. When it comes to pushing the keystone item of the liberal/progressive expansion of gov., I guess to them, the ends justify the means. |
| 2013-11-26 5:47 PM in reply to: NXS |
Pro 9391 Omaha, NE | Subject: RE: Regulation to cancel insurance policies wasn't in the ACA? Originally posted by NXS Well, at least here on BT, there were a couple of us that said these exact things would happen. During that many page debate, the majority said we were wrong and didn't know what we were talking about. But alas........... Anyway, the dems lied to sell this turd to the American people, knowing full well what was going to happen. When it comes to pushing the keystone item of the liberal/progressive expansion of gov., I guess to them, the ends justify the means. Thought you guys would get a kick out of this: |
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