California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

Alameda Alliance Removed From Covered California Insurer List

On Friday, the Alameda Alliance For Health was removed from a list of eligible insurers offering health plans through Covered California after it failed to meet state requirements for the exchange, the San Jose Mercury News reports.

Details of Removal

State officials removed Alameda Alliance from the exchange after the state Department of Managed Health Care said the not-for-profit insurer failed to meet a minimum financial solvency requirement to sell coverage on the commercial market.

Leila Saadat, chief strategy officer for the insurer, said Alameda Alliance missed the Oct. 31 deadline to meet the requirement because it needs more time to address issues related to new rates it will be paid by the state (Seipel, San Jose Mercury News, 11/1).

Anne Gonzales, an exchange spokesperson, said the situation was "not unforeseen" (Rauber, "Bay Area BizTalk," San Francisco Business Times, 11/1).

Officials with the insurer and Covered California said the removal likely is temporary and will be resolved in the coming months. Saadat said the insurer plans to reintroduce its policies through the exchange in January 2014 (San Jose Mercury News, 11/1).

The decision to remove Alameda Alliance from the exchange will not affect its Medi-Cal provider license, according to state officials (Cadelago, "Capitol Alert," Sacramento Bee, 11/1). Medi-Cal is California's Medicaid program.

Implications

Exchange officials removed Alameda Alliance several weeks after open enrollment began, so some consumers already have signed up for policies offered by the insurer, according to officials.

However, neither the insurer nor the exchange has provided estimates for the number of consumers who have signed up for Alameda Alliance plans (San Jose Mercury News, 11/1).

Exchange officials said they have "informed prospective enrollees" of Alameda Alliance plans that they will need to select a replacement plan from:

  • Anthem Blue Cross;
  • Blue Shield of California; or
  • Kaiser Permanente ("Bay Area BizTalk," San Francisco Business Times, 11/1).

Insurers Confirm Cancellation Requirements

In related news, insurers have confirmed that they were required to cancel certain plans in order to participate in Covered California, the Sacramento Business Journal reports.

The confirmation comes after some observers said insurers were making the cancellations on their own to push customers to more expensive plans, according to the Journal.

Contract language states that any insurer in California's exchange "shall terminate or arrange for the termination of all of its non-grandfathered individual health insurance plan contracts or policies which are not compliant with the applicable provisions of the" the Affordable Care Act, the Journal reports. The contract also requires insurers to "promote ways to offer, market and sell or otherwise transition its current members into plans or policies which meet the applicable [ACA] requirements."

On Wednesday, Covered California spokesperson James Scullary said about 900,000 individual policyholders will have to "transition from the private markets to a new health insurance plan" under the ACA (Rauber, Sacramento Business Journal, 11/1).

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