Calif. Requires Anthem Blue Cross To Delay Cancellation of Plans

During a press conference on Tuesday, California Insurance Commissioner Dave Jones (D) is scheduled to announce a required delay in the cancellation of about 104,000 Anthem Blue Cross health plans that do not meet the Affordable Care Act's requirements, the San Francisco Business Times' "Bay Area BizTalk" reports (Rauber, "Bay Area BizTalk," San Francisco Business Times, 11/11).

The move follows a similar state order issued to Blue Shield of California last week.

Background

Certain plans will be cancelled under the ACA because they do not meet the law's minimum coverage levels. Exchange officials say that the cancellations also will ensure that insurers do not keep the healthiest individuals out of the state health insurance exchange.

However, about half of state residents who have policies through the individual market will not be affected by the law because they have grandfathered plans that were purchased before March 2010.

Peter Lee, executive director of Covered California, told the San Francisco Chronicle editorial board that as many as 900,000 state residents could be forced to switch plans under the ACA.

Details of Blue Shield Delay

Last week, Blue Shield of California officials said that the California Department of Insurance has required the insurer to delay for three months the cancellation of more than 115,000 health plans that do not meet the ACA's requirements.

According to Jones, the move came after Blue Shield took advantage of a "loophole" in state law that allowed them to submit their plans to a regulator who oversees managed care plans. However, that shift required the insurer to give policyholders a 180-day notice of cancellation, and Blue Shield only provided a 90-day notice (California Healthline, 11/6).

Details of Anthem Delay

The state's order to delay the cancellation of about 104,000 Anthem plans comes after the insurer missed an Oct. 1 deadline to inform policyholders that they would need to obtain new coverage under the ACA.

An Anthem spokesperson said the insurer missed the deadline because of a "mailing glitch."

The delay gives policyholders until the end of February 2014 to select a new health plan that meets the health reform law's requirements ("Bay Area BizTalk," San Francisco Business Times, 11/11).

Reaction

Anthony Wright, executive director of Health Access, said that the delay is appropriate because the insurer missed the deadline.

However, Wright said that policyholders should not necessarily take advantage of the extension.

"There are likely better and cheaper options, as well as premium subsidies, in the state exchange" currently, Wright said (Terhune, Los Angeles Times, 11/11).