Under health insurance law, established options best for now

KINGMAN - The state's largest health care insurer for the individual market said Mohave County residents should skip the federal exchange when it comes to purchasing health plans to comply with the Affordable Care Act and buy directly through local brokers or the insurance companies servicing Arizona.

Policies offered online through the federal exchange are centered around Maricopa County, which includes Phoenix, said Jeff Stelnik, senior vice president of sales, strategy and marketing for Blue Cross Blue Shield of Arizona. That means access to local doctors and services may be limited - a fact not readily disclosed on the federal website that lists available policies and allows buyers to sign up for them.

"There are misconceptions out there that people can only go through the website," said Stelnik. "But there are dangers to going directly on the exchange. Some of the plans listed there don't have a robust network throughout the state and are limited outside of Maricopa County. We strongly recommend going through a broker or insurance company that has been in the community for years. Health care is very complex and to buy it through a website is hard, even when the site is working."

President Barack Obama signed the Patient Protection and Affordable Care Act into law March 23, 2010. The program was developed to put comprehensive care within the reach of millions of uninsured or underinsured Americans. More than 48 million Americans don't have any coverage, according to the U.S. Census Bureau.

In Arizona, more than 1 million residents are now eligible to shop for plans on the federal exchange, and about half of those are eligible for federal subsidies. Several major companies provide many of the state's policies - Blue Cross Blue Shield of Arizona, Aetna, Cigna, Health Net, Health Choice, Humana, University of Arizona Health Plan and Meritus.

BCBS of Arizona offers more than a dozen plans across all tiers that range in prices, said Stelnik. It is difficult to compare new rates with existing plans, he said, but premiums will be higher in January for several reasons. First, the new policies are required to include the 10 essential benefits, which limit consumers' choices.

Currently, BCBS offers deductibles ranging from $200 to $10,000, with higher-deductible plans offering fewer services. But those policies with higher deductibles - all $7,500 and $10,000 deductibles, and some $5,000 deductibles - will be cancelled because they don't meet the federal guidelines. Those that remain will cost more because they include more services, he said.

Stelnik cautioned consumers who already have policies to take their time before replacing them with new policies in January. Those purchased before the ACA became law remain in effect indefinitely, while those bought between March 2010 and the end of this year will be grandfathered in through the end of 2014. That can save policyholders significant money, said Stelnik.

Another reason premiums will be higher after January is that younger policyholders 25 to 40 years old will subsidize those 55 years and older. And because there will be no difference in price for males and females, younger males will subsidize females, who generally require more services.

Two additional factors that will raise the cost of premiums are numerous taxes and additional fees that have been added to keep the ACA afloat, said Stelnik. Also, after January, consumers with pre-existing conditions that were formerly excluded from coverage will be able to purchase policies immediately. Those increased costs must be spread around to others, said Stelnik.

"When you add everything up, the concept of premiums going up in price is a true statement," said Stelnik. "This law is so complex, and Blue Cross has taken a leadership role to help our customers find what fits them the best. The ACA has been in place since 2010, and it's the law of the land now, We haven't spent a lot of time thinking of what could have been. Instead, we've been working on how to implement what's here. We're worried about our customers and have gone into listening mode to structure the policies our customers need."

The ACA depends on younger, healthier Americans buying into the program and paying premiums to offset costs for covering older people who need more health care. Those without insurance who do not sign up for a plan face a fine. Federal sliding-scale subsidies kick in for consumers who earn up to 400 percent of the federal poverty level.

Among the new standards in the law are allowing children and dependents to remain on their guardians' insurance plans until their 26th birthday. Also, there is a ban on dropping policyholders if they become sick and there is no longer a price discrimination on the basis of pre-existing conditions or sex.

Insurers will be prohibited from imposing annual or lifetime coverage caps on 10 essential benefits. These are ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care.

The law establishes four tiers of coverage: bronze, silver, gold, and platinum. All categories offer the same set of essential health benefits but have differing levels of premiums and out-of-pocket expenses.

Open enrollment on the HealthCare.gov exchange runs from now through March 31, and insurance plans purchased by Dec. 15 will begin coverage on Jan. 1

Policies issued before 2010 are exempted by a grandfather clause from many of the changes to insurance standards.

But the program has been fraught with problems, especially lately with the failure of the website that was set up to enroll people in the new health insurance exchange starting on Oct. 1. Visitors to the website couldn't log in, faced long delays, got constant error messages and had their profiles disappear. The administration says it will have the website running smoothly by Nov. 30.

Also, Obama apologized last week to Americans whose insurance plans are being cancelled by their insurance companies because of the ACA, even though he had promised in previous years that they would be able to keep the plans. Currently, about 12 million Americans buy individual policies on the private market that don't meet the new federal requirements for more comprehensive care.