Covered California Participants May Switch Plans

Recent investigations by the California Department of Managed Health went underway for Anthem Blue Cross and Blue Shield of California due to policy holders complaining they were given misleading information by the insurance giants. Policy holders argue that they were given inaccurate information regarding their benefit plans and provider networks. Anthem and Blue Shield are now facing multiple law suits from frustrated consumers.

So what is California doing about this? California is “quietly” taking a stand by educating consumer’s about a provision under the Affordable Care Act that acts in their favor. The ACA states that a person can receive health coverage during an open enrollment period or after a “qualifying life event”. A qualifying life event is usually considered when a person moves, gets married or divorced.

Under the ACA provision, the qualifying life event also includes when a person experiences misconduct by an insurer or receives misleading or inaccurate plan information from an insurer. Therefore, the provision under the ACA may enable these policy holders to switch health plans outside of the enrollment period because it is considered a “qualifying life event” since they were given misleading information from insurers.

California has slowly been implementing this provision for the past few months as complaints about Anthem Blue Cross and Blue Shield of California continue to rise. Still, Dana Howard, a Covered California Spokesperson has mentioned that every complaint will be considered but not every complaint will result in the ability to switch plans. According to Howard, there is not complete information on the number of switches thus far but confirms that the exchange has not been overwhelmed with requests to switch plans.

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Anthem Blue Cross Under Investigation

Anthem Blue Cross is a well-known, major play player in the insurance marketplace. However, the insurance giant is under investigation by the California Department of Managed Health Care. Covered California is looking into the accuracy of Anthem Blue Cross’ provider networks due to a series of complaints by policy holders. This investigation initiated from multiple law suits brought on against Anthem by the consumers including one last June by WellPoint, Inc.

What are policy holders upset about?

  • Narrow provider networks
  • Loss of benefits
  • Bait and switch tactics to get consumers with expiring plans to enroll in different coverage where former benefits may no longer be provided without the consumer’s knowledge

Many California policy holders are stating that Anthem Blue Cross has extremely narrow provider networks making it difficult for them to seek medical attention covered under their current plan. People who purchased Anthem plans under the Covered California health exchange thought they had more options, which is why the California Department of Manager Health Care is investigating whether Anthem may have inflated the number of providers in an effort to increase enrollment participants. Anthem is saying that in order to reduce premiums, they had to decrease the number of doctors and hospitals available to patients.

According to the LA Times, one policy holder who had an Anthem plan no longer compliant with the Affordable Care Act was forced to switch to a different policy that Anthem assured her would cover the same benefits as her previous plan. However, the exclusive provider network they were claiming to enroll her in ended up being a PPO that did not cover her expenses leading to to rack up thousands of dollars in medical bills. Anthem Blue Cross refuses to pay the bills.

As a result, the executive director of Covered California, Peter Lee, is looking into these EPO policies for 2015 since they seem to have caused many consumer frustrations and large, unknown medical bills. An exchange spokeswoman stated that EPOs will still be part of the exchange benefits but they are looking into ways to better educate people about how the networks and coverage work.

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Complaints About Covered California Exchange

On July 8, 2014 the Sacramento Bee released a report stating that early 1800 complaints were filed regarding the Covered California exchange processes. It turns out that San Diego residents are not the only ones confused with the provider networks set up under California.

Complaints Filed Entail:

  • Health Cards and Enrollment Information Not Received (many participants on the exchange failed to receive their actually medical health insurance cards and information showing proof of their plans)
  • Narrow Provider Networks (not enough physicians available in certain areas)
  • Inaccurate Provider Lists (many mistakes were made when detailing which providers were covered causing patients to seek help for doctors not covered under their policy which could cause higher costs)

Covered California has been quick to react to these complaints by working with regulators. An exchange representative is working to refer some of the complaints to regulators in hopes to resolve these known issues. In addition, the California Department of Managed Health Care is looking into the accuracy of the network provider lists that were released by health care companies such as Anthem Blue Cross and Blue Shield of California. They are under investigation for violations of the law according to California Health Line.

Under the investigation, health officials are contacting providers in each county that were listed on the network provider lists from the two health companies. Officials will be comparing the provider lists with the actual contracts of the physicians. This investigation is expected to take about 60 days (started on June 23, 2014). The ultimate findings will be sent to insurers who will then have 45 days to respond. The full report will most likely be released to the public sometime in November.

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Grandmother Bill Signed Into Effect

A big win for small business health coverage took place under the “grandmother” bill signed into effect today by Governor Jerry Brown Jr.

This bill states that small business employers that have non-grandfathered health policies signed into effect before December 31, 2013 now have the option to renew their policy for another year as long as those policies are still in force as of July 7, 2014 (the day the grandmother bill took effect). This means that they will not be forced to find another health plan by the end of 2014. This bill only applies to small businesses with 50 or fewer employees. Now these small businesses will have the option to continue with their existing grandmothered plan up until the end of 2015 (December 31, 2015 to be exact).

Why did this change occur?

  • This state law took effect so it would be closer in line to the federal health exchange policy that is transitioning much more slowly. California wanted to be compliant with the federal health law time table for enacting procedures under the Affordable Care Act.

Who does this help?

  • Small businesses that opted to early renew their health plans in 2013. This bill only applies to small groups that did not already purchase a healthcare policy on the state exchange.

It’s also important to note that this grandmother bill does not apply to “grandfathered plans” existing prior to March 2010. It only applies to small group health plans that did early enrollment in 2013. This grandmother bill gives these employers the option to renew their health plans for another year. Still, the plan benefits must be compliant with state based and ACA mandated benefits such as preventative care and elimination of gender discrimination.

If you have questions regarding whether you are eligible to renew in your small group health insurance policy for another year under this grandmother bill, please feel free to contact us with any questions.

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Errors in Healthcare Enrollment Eligibility

The Affordable Care Act had a rocky start this past October causing concerns for many regarding the effectiveness and implementation of the program. The multiple website crashes along with the extension of application deadlines, may have resulted in some  website and database issues recently reported by a watchdog report. The full report shows that there are 330,000 inconsistencies in consumer reported data that have been unresolved. The website issues from October to December are reportedly the cause of the data problems. The report reveals that there were 2.9 million issues in the healthcare.gov database. However, only 2.6 million of those data inconsistencies have been resolved.

So what does this really mean?

  • Errors in the healthcare.gov database may reveal that some people received subsidies who were not eligible. Thus, they may be forced to pay back subsidy costs when filing taxes in 2015.
  • Eligibility to receive healthcare benefits and subsidies may be jeopardized. Many of the reported problems dealy with citizenship and income information that differed from government records. Thus, people who were predetermined as eligible to enroll in healthcare may no longer be able to.

This issue is one of the primary problems the new Health and Human Services Secretary, Sylvia Matthews Burwell, will be facing prior to the next open enrollment period in October.

So what next?

The law states that there is an option for extending the initial 90-day period in order to clean up any discrepancies in the data moving forward. Many state run exchanges will be looking into this option since they have been unable to resolve the issues.

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