McKinney calls for special session to prevent Obamacare insurance cancellations

Senate Minority Leader John McKinney, R-Fairfield, introduced Obamacare as a gubernatorial issue Friday by challenging Gov. Dannel P. Malloy to call a special legislative session to allow insurance companies to extend insurance policies slated for cancellation at the end of the year.

In a late afternoon press conference, McKinney, a candidate for governor, characterized the Democratic governor as a strong backer of the president on health care, echoing efforts by the national GOP to use Obamacare as a wedge issue in next year’s mid-term congressional races.

“I would expect as a political matter Gov. Malloy to continue to cheerlead and champion Obamacare. He has from day one. I can’t imagine he would change,” McKinney said. “I am very comfortable saying I’m opposed to Obamcare. I think as of right now, quite frankly, I am winning. Obamacare is failing.”

The Malloy administration called McKinney’s proposal premature, and the governor’s political allies, including House Speaker J. Brendan Sharkey, D-Hamden, the Senate Democratic majority and the state Democratic Party accused McKinney of playing politics.

“This administration is moving forward with implementing the Affordable Care Act so that more residents will have access to quality, affordable healthcare,” said Andrew Doba, a Malloy spokesman. “In the wake of the decision yesterday in Washington, the governor has asked the lieutenant governor and his insurance commissioner to gather the facts and determine what action, if any, needs to be taken by the state to ensure we are achieving this goal. Until all the facts are in, there is no reason to call a special session.”

President Obama announced Thursday that insurers would be allowed to renew existing insurance plans next year, even if they don’t meet the requirements of the federal health law, a move intended to quell anger about the cancellation notices that hundreds of thousands of policyholders have received.

But McKinney said that a state law passed in 2011 would make that impossible unless the legislature and Malloy take action. The law requires that insurance products sold in the state comply with terms of the Affordable Care Act, the law commonly known as Obamacare.

If insurance companies are to extend policies they had planned to cancel, they would need to receive approval for new rates from the Connecticut Insurance Department within the next seven weeks. McKinney said lawmakers would need to provide for an expedited, “truncated” process for the insurance department to review the rates and plans insurance companies extend.

Obama’s plan leaves it up to each state’s insurance department to determine whether policies that don’t meet the health law’s requirements can be extended into 2014. And the insurers won’t be required to continue any policies.

The governor said Friday morning in response to Obama’s directive that he did not see cancellations as a major issue in Connecticut.

“I don’t think it’s going to have a big impact on Connecticut,” Malloy said of the policy change. “The insurance policies that could be sold in Connecticut were held to a substantially higher standard than the national standard.”

Sharkey said McKinney was pushing politics over policy.

“Once again, Sen. McKinney is playing electoral politics, this time with our health care system,” Sharkey said. “Access Health CT, Connecticut’s heath care marketplace, is leading the country. We are the only state that has more private insurance sign-ups than Medicaid sign-ups, and we already had among the highest standards of coverage in the country. Our health care system is too important, for too many people, to be used as one of Sen. McKinney’s campaign props.”

The Senate Democratic majority also backed Malloy.

“The Access Health CT website, like Kentucky’s and other states that created their own websites, is working well,” said Adam Joseph, a spokesman for the caucus. “We agree with Gov. Malloy, that in light of yesterday’s decision in Washington, we should gather all the information before deciding what, if any, action is warranted.  Calls for an immediate special session are, at best, premature.”

Just as McKinney linked Malloy to Obama, a spokesman for the Connecticut Democrats suggested that McKinney was “taking his cues from the Tea Party.”

The House GOP issued no statement on McKinney’s proposal.

Insurance Commissioner Thomas B. Leonardi had said Thursday after Obama’s announcement that he would examine the cancellation  issue, but coping with the cancellations is an area in which politics and policy may clash.

Insurance companies and regulators have expressed concern about Obama’s plan to delay the cancellations.

The insurance industry trade group, America’s Health Insurance Plans, warned that making changes could destabilize the market and lead to higher premiums. The National Association of Insurance Commissioners, meanwhile, said that having different rules for different policies could undermine the new market.

The American Academy of Actuaries’ Health Practice Council also warned that the change could be problematic.

Because insurers in most states can currently select which customers to cover and exclude people with medical conditions, those who can extend their existing plans are likely to be healthier and use fewer medical services. If they stay in the old risk pool, the new health plans being offered as part of the health law — which will be available to everyone, regardless of medical history — could end up covering a disproportionate number of sick people or those who use more medical care.

The group warned that could mean that premiums already approved for the new plans won’t be enough to cover the benefits, and could lead to more federal spending in a government program designed to limit insurers’ losses in exchange plans.

Thousands of Connecticut residents have health plans that are slated to be discontinued at the end of the year. Aetna, for example, is discontinuing nearly all of its plans and replacing them with redesigned options in both the individual and small-group markets. Anthem Blue Cross and Blue Shield, the state’s largest insurer, is discontinuing some of its plans at the end of the year and replacing them with new ones. Most of ConnectiCare’s plans are slated to be discontinued, and CIGNA stopped selling plans that don’t meet the health law’s standards earlier in the year.

While some of the plans being cancelled have high deductibles or a low level of covered benefits, some provide relatively generous coverage with lower out-of-pocket costs than plans being offered in 2014.

Some people who have received cancellation notices have opted for a short-term change: Buying a plan that starts in 2013, giving them 12 months of coverage under the old rules and pricing. Brokers have described it as a way to lock in existing lower premiums and benefits. But the option is only available to people who are healthy enough to get coverage in the existing market, because insurance companies can still be selective about whom they cover. That will change at the start of next year, when insurers will be required to cover anyone who wants insurance.

McKinney said he had heard from constituents upset about having their plans discontinued, including a single mother who found that the alternative options available on the state’s health insurance exchange would be more costly.

So far, McKinney said, more people in Connecticut were losing their health insurance than would gain it under Obamacare. He was referring to the thousands of people who have gotten notices saying their plans would be discontinued Jan. 1, and comparing it to the 13,128 people who have signed up for coverage through the state’s health insurance exchange.

Enrollment in the exchange is not complete, however; coverage does not take effect until Jan. 1 at the earliest, and people have until March 31 to sign up.