CHEYENNE, Wyo. (AP) - Private insurers have told the state of Wyoming that they plan to cancel more than 2,600 health insurance policies for state residents largely because of increased regulation and higher minimum standards set by the federal Affordable Care Act.
Wyoming Insurance Commissioner Tom Hirsig said Thursday most of the cancellations will take effect in December and March. Other companies already have cancelled more than 500 health policies in the state, mostly earlier this year. More cancellations could come as federal deadlines kick in early next year.
"Any of these plans that are cancelling, they wouldn't be withdrawing if not for the Affordable Care Act," Hirsig said. The federal act sets minimum standards for acceptable insurance coverage and costs.
Hirsig says many customers whose policies are being cancelled would qualify for federal subsidies to get approved health insurance under the act. However, he said it's unclear when government-approved coverage will be available.
President Barack Obama's administration has come under harsh criticism for problems with the federal health care website. Not only is it supposed to provide access to approved health care plans, it's also supposed to calculate the amount of allowable tax credits to help people afford coverage based on their income.
Administration officials now say they expect problems will be resolved by the end of November.
"If the exchange is not functional to dole out those subsidies, and today it's not, what are those people going to do?" Hirsig said. "Can they afford a new plan without a subsidy? That's going to be the question."
Federal subsidies promise to be especially important in Wyoming. It's the nation's least-populated state, with about 560,000 people. It also faces some of the nation's highest prices for federally approved health care plans.
The national average cost for a monthly premium "silver" plan would be $774 for a family of four making $50,000 a year. In Wyoming, that rate would be $1,237 before allowable tax credits, according to federal figures.
WINhealth, a Cheyenne-based health maintenance organization, is one of two companies seeking to offer federally approved coverage in Wyoming on the federal website. Blue Cross Blue Shield of Wyoming is the other.
Stephen K. Goldstone, president and CEO of WINhealth, said this week that cancellations of existing plans in Wyoming will mainly affect people who have individual coverage, not members of group insurance plans. Plans that will remain on the market offer more comprehensive benefits, he said.
The cancellations obviously won't affect any of the roughly 83,000 currently uninsured people in Wyoming.
Shortly after the passage of the Affordable Care Act, insurance companies had the option to declare plans as "grandfathered in," Goldstone said, meaning that as long as a purchaser didn't make changes they could keep existing benefits as long as they wanted. He said his company opted not to grandfather its plans to avoid having to administer multiple, possibly redundant plans.
"The plans that we offer today, as a result of this, have more comprehensive benefits than the plans that would have been grandfathered," Goldstone said. "It's more expensive but it's more comprehensive coverage. Whether people felt that they needed more comprehensive coverage or not is subjective, I guess."
Wendy Curran with Blue Cross Blue Shield in Cheyenne said she doesn't believe her company has many non-grandfathered individual plans. She said that most people with non-grandfathered plans won't have to make a change until next year, so the company hasn't sent out cancellation notices yet.
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