Pennsylvania OKs extending Special Care health plans

Nov. 27--Subscribers to low-income Special Care health insurance plans issued by Pennsylvania'sBlue Cross companies will be able to continue coverage into next year, state Insurance Commissioner Michael Consedine said Tuesday in the first of what is likely to be several announcements in Pennsylvania and New Jersey to avoid a wave of policy cancellations.

"We are trying to at least give [current subscribers] some certainty," he said in an interview, so that by the end of the year nobody in the individual market is left without coverage.

Insurers had sent cancellation notices effective at year's end to at least 250,000 subscribers, making up one-third of Pennsylvania's individual market, or 3.4 percent of those with private insurance. Insurers said the plans did not meet minimum standards of the Affordable Care Act.

Millions of similar letters went out nationwide, creating a furor because President Obama had repeatedly said that people could keep their existing policies if they wanted after key elements of his signature health law kick in Jan. 1. With his credibility at stake and major problems at the website Healthcare.gov, Obama said two weeks ago that he would allow insurers to extend plans. Whether to do so, however, is up to carriers and regulators in each state.

"Even prior to the president's announcement," Consedine said, Gov. Corbett had asked him to reach out to insurers.

Based on those voluntary discussions, he said he expected that many would allow subscribers to temporarily remain on their policies, while others would work aggressively to switch members to new policies that meet federal standards. Insurers can sell policies available through the federal exchange but subsidies must come from the government.

At least nine states -- such as New York and California, which opted to run their own exchanges -- have refused to rescind cancellations, arguing that changing the rules so late could disrupt their insurance market. But most are leaving it up to insurers or have yet to decide, according to a tally last week by Pew Charitable Trusts' Stateline news service.

New Jersey Banking and Insurance Commissioner Ken Kobylowski announced Tuesday that carriers would have the option to continue canceled plans. A spokesman for Horizon Blue Cross Blue Shield, the largest insurer, which had sent 90,000 cancellation notices, said no decision had been made.

Delaware Insurance Commissioner Karen Weldin Stewart announced an agreement with insurers Monday to allow early renewals of affected policies in that state.

The continuations do not mean that rates will remain unchanged. Indeed, Independence Blue Cross said Tuesday it would request an increase from the state due to the "operational and financial impact" of continuing its Special Care plan in Southeastern Pennsylvania. Other Blues administer it elsewhere.

Special Care is a bare-bones, low-cost plan with income eligibility of $23,000 for an individual. IBC said letters would go out in the next few weeks giving its 6,300 policyholders the option of continuing coverage through June 30.

Also scheduled for cancellation on Jan. 1 are IBC's Guaranteed Enrollment Plans, which provide coverage regardless of medical conditions to 17,400 subscribers.

Those plans will not be extended. IBC instead will work to enroll members in new plans that meet federal requirements. "In most cases," it said in a statement, premiums for those "are lower" than for current plans.

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