What if your Obamacare insurer has left the business?
Open enrollment for the Affordable Care Act health insurance exchanges officially starts Nov. 1, and exchange members looking at that date face a double whammy.
First, premiums for the midlevel benchmark plan are expected to increase 25 percent on average in 2017, according to the Department of Health and Human Services. Keep in mind, that’s an average. Some areas will see increases in the triple digits, and some rare counties will see premiums decline. But overall, these hikes are going to come as a big surprise.
In addition, hundreds of thousands of consumers are now covered by one of the many large insurance companies that have recently pulled out of the exchange business. Those consumers may well be scrambling for coverage elsewhere. If you’re one of those abandoned customers or someone who’s looking at a big price hike, you’ve likely been wondering what you’re going to do next.
So has the government. Earlier this month, the Obama administration assured exchange members facing premium hikes that government subsidies would rise with the premium hikes, keeping customers whole.
Plus, the federal government, which runs all but 12 of the state exchanges, recently announced a plan to match consumers who have been abandoned by their insurer to a similar remaining plan in the exchange.
The idea is to relieve consumers of some of the burden of shopping for a new plan and help make sure they stay insured. The strategy was outlined in an administration document that circulated among insurers, state regulators and consumer groups. So-called “discontinued consumers” will receive frequent reminders to sign up during the open-enrollment period, which ends Jan. 31.
Earlier this year big insurers UnitedHealth (UNH), Aetna (AET) and Humana (HUM) and some smaller names announced they would drastically reduce or stop selling health care policies through the exchanges In addition, several nonprofit co-ops that also did business through the exchanges have shut down.
The result is a substantial increase in the number of people who’ll be changing health care plans during the 2017 open-enrollment period. Many will have only one insurer left in their exchange selling multiple plans. According to Kaiser Family Foundation, only 60 percent of exchange members nationwide will have three or more insurers to choose from, compared to 85 percent during 2016’s open enrollment.
What can you do if you’ve been abandoned by your insurer? You’ll need to keep an eye on the government’s efforts to match consumers with another plan to make sure you understand what’s happening. You’ll also need to do some due diligence on your own. The following advice from Joel Ario, a previous director of Health and Human Services and managing director of consulting firm, Manatt Health, may help.
Watch your mail. You may have already received a notice from your insurer telling you that your coverage is ending. Such a notice is a signal that the government is finding an alternative plan for you. Consumers will be matched to a new plan that’s closest to the one they have now.
But how that works will depend on what’s available. Even a close match in an area with plenty of choices could mean you’ll need to change provider networks, benefit levels and drug coverage. In areas with only one insurer, the new plan could be significantly different. And almost everyone is looking at an increase in premiums. (Keep in mind, government subsidies rise with premium prices, so consumers who qualify shouldn’t have to pay major increases.)
Sometime during open enrollment you should receive a packet of information and a bill for the first month’s premium from the insurance company you’ve been matched with. This means you’ve been automatically enrolled in the new plan.
But you don’t make the actual switch until you pay the bill. So the choice is still yours. You can pay the bill and join the new plan, shop for, enroll in and pay for another plan or opt for no insurance at all and face potential tax penalties.
Keep in mind that being switched to a new plan automatically applies to states with exchanges run by the federal government. If you live in a state that runs its own exchange, you need to check to see if it’s also automatically enrolling discontinued consumers into new plans. Most state-run exchanges are expected to follow the fed’s lead, but not all have announced their plans yet, Ario said.
Don’t wait for the government. If you know you’re going to have to change plans, go to Healthcare.gov to check out your remaining options. If you find an alternative that suits you, go ahead and sign up as soon as open enrollment begins to avoid what’s bound to be a big rush and potential logjam as the deadline nears.
When and if you do find out what plan the government has matched you with, you’ll have a heads up on the specifics of that policy. Starting now means you’ll have time to determine what doctors and other health care providers are on which insurer networks, what premium and other out-of-pocket costs you’ll pay, what prescription drugs are covered and how all of that compares with the coverage you had.
If you enroll in what seems like the best alternative and then decide the government-picked plan is better, you can always change again. You can switch plans as often as you need to during open enrollment as long as you haven’t paid the first month’s premiuml. (If you’re sure you want to shop on your own, you’ll be able to opt out of having the government choose a plan for you on HealthCare.gov, according to Ario.)
Pay attention to “simple choice.” While you’re shopping, look for the “simple choice” offering on Healthcare.gov. This is a government effort to simplify the exchange offerings and, at least in one area, standardize options. The administration has been encouraging insurers to offer a standardized plan that offers the same pre-deductible health care and prescription drug reimbursements as well as out-of-pocket spending limits across the bronze, silver and gold levels.
It has yet to be determined how widespread this new program will be. But for many consumers, simple choice may offer the best way to compare benefits among ACA options.
Be patient. Insurers may not be ready for the onslaught of new customers, especially in areas where only one or two carriers are left. Long hold times on call lines are expected, and carriers are encouraging consumers to sign up early. In addition, the government told insurers that it would ease up on enforcement of consumer service standards because of the anticipated high rate of new enrollees.
The Associated Press contributed to this article.