Thousands of middle-class consumers in the Northern San Joaquin Valley did not fully realize what the federal health law would mean to them, until their insurance polices were canceled this fall and they learned how much the new coverage will cost.
They are facing sharply higher premiums and deductibles for health insurance starting Jan.1, and there are few choices as they scramble to find new policies that meet their needs. An estimated 900,000 Californians who buy individual or family coverage received letters from insurers that said their policies won’t exist next year because they don’t meet federal standards under the Affordable Care Act.
The choices for next year in Stanislaus and nearby counties are the plans offered by four insurers through the Covered California health exchange or similar plans from the same insurers: Kaiser Permanente, Anthem Blue Cross, Blue Shield and HealthNet. For consumers not eligible for federal subsidies, those plans are more expensive and have far higher annual deductibles.
Dave Anderson, a 56-year-old Hughson resident and retired police officer, said he bought insurance last year for himself and his wife from Anthem Blue Cross, but last week he was told his premiums will jump from $560 to $968 per month starting Jan.1, a 76percent increase.
“I want to be heard,” said Anderson, who wishes elected officials would hold a town hall meeting so the public can share stories. “I feel like we moved to a communist country and are being told: This is what you are going to get.”
About 2million consumers in the state have bought health insurance on the individual market, and most of those plans don’t pass muster with the federal law unless they were held before March 2010 and meet grandfathering rules.
Brokers say most of the plans being canceled provided ample protection against crushing medical bills – the reason people buy insurance – but they’re being canceled because the federal standards require coverage for maternity care, regardless of the person’s gender or age, and more extensive mental health coverage.
Many of the 14million Americans affected feel they were misled by President Barack Obama’s repeated statements that they could keep their coverage.
“The real story is there is absolutely no commercial insurance available, other than the products offered by the state,” said Ed Persike, owner of Persike Benefit Solutions in Modesto.
A year ago, there were more than 100 plans available for consumers in Stanislaus County, Persike said, but the choices now are the state-approved Bronze, Silver, Gold and Platinum plans providing 60percent to 90percent coverage for medical bills.
Some of the state-approved replacement plans offered to local consumers look like low-end insurance, with out-of-pocket maximums of $6,350 for a single person and $12,700 for a family, and 60percent coverage of emergency room, hospital services and prescription drugs after the deductible.
Persike charged that state regulators have dragged their feet on approving other plans not offered through the exchange.
Dennis Nasrawi of Modesto and his significant other have been paying for their coverage during semi-retirement out of health savings accounts, and one of his daughters has relied on an HSA. Nasrawi has a grandfathered plan, but coverage for the other family members will be canceled effective Jan.1.
Kaiser offered to replace his companion’s plan, costing $464 a month, with its lowest-cost option for $563 a month, a 21percent increase. Because her annual deductible would increase from $2,700 to $4,500 and her out-of-pocket limit from $5,000 to $6,350 a year, she likely will upgrade to an HSA costing $731 a month, Nasrawi said. She’s not eligible for a subsidy.
A similar Blue Shield plan offered to Nasrawi’s 34-year-old daughter would cost 76percent more per month and increase her annual deductible from $1,800 to $4,500 a year, with 60percent coverage for hospital care and prescriptions. That won’t cover the bills for treating her chronic health condition, so the schoolteacher is switching to insurance from Modesto City Schools.
Connie Nelson, 64, of Riverbank said a comparable Kaiser plan to replace her canceled coverage would cost her $600 a month next year, a $200 monthly increase. She plans to go without insurance until she’s eligible for Medicare. Nelson doubted Kaiser’s explanation for the increase. “Kaiser blamed it on the government, but this is a perfect time for them to slam dunk us older people,” she said.
In a statement, Kaiser said cancellation notices were sent to about 2.5percent of its members because their plans were not compliant with the federal law. “What is important to understand is that individuals with noncompliant products are being provided with modified plans that are ACA-compliant and include comparable health care service,” the insurer said.
About a month before the Dec.15 deadline for changing coverage effective Jan.1, a number of health plans outside the exchange are awaiting approval from state agencies.
Marta Green, spokeswoman for the Department of Managed Health Care, said new insurance products usually are submitted to the agency in June or July, but filings for the so-called off-exchange plans came in September and October this year. Beside the late filings, it has taken time to ensure the plans comply with rules regarding out-of-pocket limits in a bill signed by Gov. Jerry Brown in September, Green said.
The agency expects to approve off-exchange plans by Friday for Anthem Blue Cross, Kaiser and Aetna, and continues to review a HealthNet plan. Green said she expects the Anthem and Kaiser plans will be offered in Stanislaus County.
As turmoil over terminated health insurance policies continues across the nation, Anthem Blue Cross of California on Tuesday became the latest company to grant a brief extension to some of its customers. The company announced the move after failing to issue timely notices, which will allow roughly 104,000 consumers with expiring policies to keep their coverage through Feb.28.
Policyholders have until Dec.15 to notify Anthem to temporarily extend their plans. Blue Shield of California last week announced a settlement that will allow roughly 113,000 customers to remain on their plans for an extra three months, including 1,700 subscribers in Stanislaus County. The company agreed to the extension after state Insurance Commissioner Dave Jones threatened to sue over customers not receiving a 180-day notice.
Blue Shield told customers they may have to pay their deductible twice in one year if their coverage is extended through March31. After changing to a new plan in April, earlier payments may not be credited to the deductible on the new plan, the insurer said.
Staff writer J.N. Sbranti and The Sacramento Bee contributed to this report. Bee staff writer Ken Carlson can be reached at email@example.com or (209)578-2321.