While much attention has been focused nationally on technological problems hampering the rollout of the federal health reform law, the head of Connecticut’s health insurance exchange said Wednesday that another issue is likely to become more prominent: Price.
Kevin Counihan, CEO of Access Health CT, predicted the focus will shift to rates and coverage as people who buy their own insurance begin learning about their options for 2014.
Some people will be happy to learn they qualify for subsidized insurance bought through the state’s exchange, he said. But others will be less pleased to learn that they won’t be able to keep plans with $10,000 deductibles, or that they’ll have to pay for maternity coverage even if they don’t plan to use it.
“It’s going to be a little bit of a ‘me vs. we’ kind of discussion, I believe,” Counihan said during a conference call with reporters.
There have already been concerns about the price of insurance in the state. Cost has been a top complaint among people who phone the Access Health call center, and people working to sign up the uninsured for coverage have said that one challenge has been convincing people with tight budgets that they should find a way to pay for insurance they might see as too expensive.
In a recent survey of Access Health applicants, the vast majority who answered said they were pleased with the enrollment experience. But some had complaints about cost: “My premium is going up $100 per month with a larger deductible. Not happy,” one said, according to Counihan. “More expensive than I expected,” another said.
Counihan said the focus on price should lead to a focus on value. People will find the coverage they’re buying for 2014 is more comprehensive, with lower out-of-pocket expenses for many and caps on what people must spend out-of-pocket, he said. There will also be changes in how prices are set, so medical history and gender can’t be taken into account.
The rates will also reflect an investment in having a more healthy population by expanding coverage to more people, allowing them to get preventive care rather than higher-cost acute services, he said.
“The rates that people pay have to be in proportion to the value they get for the money they spend,” Counihan said.
Some of those concerned about the price are people who didn’t expect to be shopping for new coverage this year, like Laurie Grunebaum.
The Woodbridge clinical psychologist and her husband, also a psychologist, have purchased their own insurance for years. This year, they pay close to $27,000 in premiums for what she considers good insurance, with a low deductible and coverage for when their out-of-state young adult daughters get care.
Grunebaum said she supported the health reform law. Because the president said people who like their plans can keep them, she figured her family would continue to pay high premiums for insurance, but that people who were poor and disadvantaged would gain coverage.
Then she got a letter from Anthem Blue Cross and Blue Shield, saying her family’s plan was being discontinued. The letter said the company would select a new plan for them, but didn’t provide details. Grunebaum worries the new plan will provide worse coverage for more money and might not offer out-of-network benefits to cover services for her daughters.
“We feel deceived and betrayed,” she said. “We are lifelong Democrats, and if we could vote it down right now, we would.”
Anthem isn’t the only company discontinuing plans. Aetna is discontinuing nearly all of its individual and small-group plans and replacing them with redesigned options. CIGNA stopped selling plans that don’t meet the health law’s standards earlier this year, and people covered by them will need to get new ones when their policies end. The majority of ConnectiCare members will need to change their plans too.
The health law includes a number of new requirements for how insurance plans are designed. For those whose plans are close to meeting the new rules, there could be new plans available that are relatively similar to their current coverage. But for those with plans that have high deductibles or cover a relatively low percentage of medical costs, the new options could be significantly different, providing more comprehensive benefits and more coverage, but likely with a higher price tag.
Some of the plans being discontinued were considered grandfathered, meaning that they would not have had to meet the requirements of the health law if they were still offered next year.
Susan Durkin, an insurance adviser at the Aita Financial Group in Washington Depot, said she’s seen some plans being offered as alternatives for people whose plans are being discontinued. For many, the new plans would cost $100 to $200 more per month and come with higher deductibles, she said.
Dean Aita, the firm’s president, said they are recommending that customers who need to buy new plans consider getting a policy that takes effect this year, which would allow them to get another 12 months of coverage under existing insurance rules and prices. Because the health law’s prohibition on denying coverage to people with pre-existing conditions doesn’t take effect until Jan. 1, that option only applies to people who could be approved for coverage based on their health.
Supporters of the health law point out that financial assistance will be available to help offset premium costs for many people. Counihan said 72 percent of people with individual insurance policies in the state are expected to qualify for subsidized premiums if they buy coverage through the exchange. The subsidies are based on income, and are set so that a person wouldn’t pay more than a fixed percentage of his or her income for a midlevel plan.
“The subsidies can be pretty impactful,” Counihan said.
But he noted that more than a quarter of individual policyholders aren’t expected to qualify for subsidies, and that Connecticut has among the highest medical costs in the country.
“There’s clearly issues around price that we have to deal with,” he said.