So, you finally picked out your company’s ACA-compliant insurance plan for next year and . . .now what?
Earlier today, apparently caving to pressure from Democrat and Republican lawmakers alike, President Obama announced that, for another year, you can keep the same plan you have now. The transitional rule applies to both the individual and small-group insurance markets. As long as you had coverage in effect on October 1 this year and got a cancellation notice, or were informed that you would need to pick a new, possibly more expensive, fully ACA-compliant plan for 2014, now you don’t have to.
That’s right, even if your current health plan does not meet the new standards on modified community rating and essential health benefits, you are welcome to keep it--and continue enjoying current rates. Why the change? Well, if you haven’t heard, the online insurance exchanges run by the federal government and many states have had a rocky rollout so far, preventing many people from enrolling in new plans. And as insurance companies have started sending out cancellation notices to existing customers--really just reminders that they needed to sign up for new plans in 2014--Obama has faced mounting pressure to make good on his oft-repeated promise that “if you like your existing health plan, you can keep it.”
The new rule allows insurers to continue offering their older plans, but it doesn't compel them to. While the Department of Health and Human Services is encouraging state insurance regulators to follow the transitional policy and sign off on reinstating any cancelled policies, it isn't clear what those regulators, let alone the insurance carriers, will actually decide to do. Meanwhile, individuals and small businesses enrolling in health plans for the first time will still have to pick from the new, ACA-compliant plans. And small businesses that want to qualify for a Small Business Health Insurance Tax Credit will still need to buy plans through a SHOP Exchange to qualify.
While current plans may be cheaper than the newer ones replacing them, that may not always be the case. And, in general, the new ACA-compliant plans offer a far more comprehensive coverage package than current ones. That said, if you’re worried about the hassle--and the cost--of totally revamping your business’s health coverage before January, get on the phone with your broker or insurance company now (expect a busy signal for a while), and see what your options are.