Rhode Island will require all residents to have health insurance that complies with the standards outlined in the Affordable Care Act by March 31, despite President Obama’s decision Thursday that anyone on canceled individual or small business insurance plans can keep their coverage for another year, announced Rhode Island Health Insurance Commissioner Kathleen Hittner and HealthSource RI Director Christine Ferguson Friday.
Millions of Americans have received letters from their insurance providers in recent weeks informing them that their plans do not meet the ACA’s standards and will be canceled, though Obama originally insisted that under the new law those who preferred their current coverage could keep it. Obama announced the option for some to extend their plans in response to bipartisan backlash to the planned cancellations.
“After reviewing the president’s announcement, we have decided to continue in the direction we are going and therefore will not be adopting the option made available to us by the president,” Hittner and Ferguson announced in a joint press release Friday.
All plans available in Rhode Island in 2014 through the HealthSource RI marketplace have already been reviewed and “designed to meet the standards set forth in the (ACA),” wrote Dara Chadwick, chief of strategic communications and media relations at HealthSource RI, in an email to The Herald.
The federal reprieve was meant to ease the implementation process, but it also required insurers to inform consumers about alternative options and explain why their plans did not meet the requirements outlined in the ACA, according to National Public Radio.
The state’s decision to opt out of the federal reprieve was motivated in part by the fact that the exchange will be most effective if all Rhode Islanders participate, said Ira Wilson, professor of health services, policy and practice. Many of those who would choose to stay on lower-cost individual or small business plans for an extra year are actually low-risk patients, who are important in balancing the exchange, he said.
Blue Cross and Blue Shield, the only insurer in the state’s individual market, never planned to issue cancellation notices, opting instead to take a “low-key and practical approach” by shifting consumers to similar plans that comply with the ACA, Wilson said.
“The president’s decision puts pressure on plans to basically reverse something they’ve been thinking about and planning for several years,” Wilson said. “It’s not a simple way to solve the problem,” he added.
While California, Colorado, Florida, South Carolina, Ohio and Oregon said they would honor the one-year reprieve, Washington and Vermont — two other states running state-based insurance exchanges — have joined Rhode Island in opting out, Reuters reported.
Many states, including Massachusetts, remain unsure about how to proceed, and the initial range of reactions to the overhaul did not run along states’ political lines, according to a Monday Politico article.
Many states are hesitant to add another dimension to already complex regulations, and some are concerned that a one-year extension on existing plans could drive up premiums for new coverage options, Politico reported.
Though Rhode Island’s technology and enrollment process “is working beautifully,” anyone whose premiums might increase due to the new, stricter standards might be disappointed with the state’s decision not to adopt the federal fix, Wilson said.
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