Last Modified: Sunday, November 17, 2013 1:26 AM
Is it true that most of the insurance cancellations are because one of the clauses of Obamacare is that everyone has to carry prenatal in the policy?
The Affordable Care Act lists maternity and newborn care among the 10 “essential health benefits” categories that insurance plans must cover. But inclusion of services under that category alone isn’t the reason for the cancellation notices that have been sent to individual purchasers in recent weeks.
The primary reason for the cancellations is the policies weren’t subject to the ACA’s grandfather clause, which The Informer wrote about in September 2012.
Under the grandfather clause, plans that existed on March 23, 2010, when the ACA was signed into law, were exempt from most of the health care reforms as long as the policies didn’t undergo significant changes — such as large shifts in cost share or a sharp reduction in benefits.
Some canceled policies were undone because they changed, losing their exempt status. Others were canceled because they were purchased after March 2010 — meaning they never were exempt — and didn’t comply with the ACA’s requirements, including the essential benefits provision.
Those essential benefit categories, according to HealthCare.gov:
Ambulatory patient services.
Maternity and newborn care.
Mental health and substance use disorder services, including behavioral health treatment.
Rehabilitative and habilitative services and devices.
Preventive and wellness services and chronic disease management.
Pediatric services, including oral and vision care.
“Most policies in the individual market are not ‘grandfathered’ and therefore have to come into compliance with the ACA requirements starting on January 1, 2014 or when those policies renew throughout the year,” reads the website of America’s Health Insurance Plans, an industry group.
“The primary reason most policies are not grandfathered today is because people chose to change their policies or purchased new coverage after the law was enacted. According to regulations released by (the Department of Health and Human Services), ‘between 40 percent and 67 percent of policies are in effect for less than one year’ and ‘the high turnover rates described here would dominate benefit changes as the chief source of changes in grandfather status.’ ”
President Barack Obama on Thursday announced that the administration would permit insurance companies to offer non-ACA-compliant policies for an additional year if they wanted to. U.S. Sen. Mary Landrieu, D-La., is pushing a bill that would require insurers to renew the policies.
The House on Friday passed a GOP-sponsored plan to allow insurers to renew the canceled plans and to keep selling low-cost, bare-bones policies that don’t comply with the ACA. The president has threatened to veto the bill, which isn’t likely to get through the Senate.
The Informer answers questions from readers each Sunday, Monday and Wednesday. It is researched and written by Andrew Perzo, an American Press staff writer. To ask a question, call 494-4098, press 5 and leave voice mail, or email firstname.lastname@example.org