Some Illinoisans may get to renew canceled insurance plans

By Jamey Dunn

After the rollout of Obamacare got off to a rocky start, some Illinoisans may be able to keep their insurance polices that do not meet the minimum requirements of the law.

The Illinois Department of Insurance announced today that it will allow insurance providers to renew for one year plans sold on the individual marketplace that do not meet the coverage levels required by the Patient Protection and Affordable Care Act. The new law requires that insurance plans offer a set base level of coverage in 10 “essential health” categories, such as prescription coverage, ambulatory care and preventative care.

President Barack Obama’s administration also announced today that it was extending one of the deadlines to purchase insurance through the online marketplace. Under the original plan, consumers who wanted their insurance to kick in by January 1 were required to make their purchase by December 15. The administration has moved that cutoff back to December 23. The change does not apply to other deadlines. The end of the enrollment period for 2014 is still set for March 2014, and those who are still uninsured at that point would potentially face penalty fees under the individual mandate.

Obama’s previous statements that Americans who like their insurance coverage could keep it after the law went into effect has come under harsh criticism after insurance companies began canceling polices that did not offer the basic coverage required. The Illinois Department of Insurance estimates that 185,340 Illinois residents have been notified that their coverage has been canceled.

In the face of the backlash, the administration has decided to allow companies to renew those plans. State insurance officials in each state must also approve the renewal of such plans. “DOI came to this decision based on the concerns raised by Illinois consumers and the guidance from the U.S. Department of Health and Human Services,” Andrew Boron, director of the Illinois Department of Insurance, said in a prepared statement. “Allowing companies to renew current plans gives consumers more time to evaluate their options and will provide a smoother transition into the health care coverage system envisioned by the ACA.

While Illinois, Florida, North Carolina, Ohio, Kentucky, Kansas, Oregon, South Carolina, Colorado, Hawaii and Texas have approved the president's  proposal, officials in some states, such as New York, said they do not plan to.

Insurance providers will be able to renew plans, but it is up to the companies to decide whether they will offer renewals. They will also be required to notify customers that they are waiving protections afforded by the new law. The companies must also let customers know they can shop for alternative plans on the online health insurance exchange and may be eligible for federal subsidies to purchase insurance that does meet the coverage requirements.

The online exchange has been plagued with technical problems, and many consumers have been unable to create accounts, let alone find out what plans would cost or what subsidies they might be able to get. Officials from the U.S. Department of Health and Human Services say they plan to have the website fully operational for most users by the end of this month.

Check out this Stateline story for a good Q&A on the policy change and a breakdown of how other states are handling it.