Health insurer Horizon Blue Cross Blue Shield of New Jersey has announced it won't renew any 2013 small group or individual health insurance plans after the end of this year.
The insurer issued a statement saying undoing years of work to comply with Patient Protection and Affordable Care Act health plan requirements and "essentially creating new plans in three weeks" is not possible.
"Horizon BCBSNJ is committed to helping our customers understand the status of their policies and all of their options," Thomas Rubino, Horizon's director of public affairs, wrote in the statement. "We have already begun and will continue notifying individual and small group customers with approaching renewal dates of what their options are for converting their old policies into new ACA-compliant policies."
Last month, President Barack Obama decided to use executive action to allow health plan providers to continue offering individual coverage next year that doesn't meet the reform law's requirements.
Originally, non-grandfathered policies — plans that went into effect or underwent certain changes after the PPACA became law in March 2010 — had to meet new coverage requirements in 2014. Under the PPACA, individual health plans must cover "essential benefits" such as prescription drugs, mental health services and maternity care. Insurers must also cap consumers' annual expenses.
Many insurers sent out cancellation notices to people enrolled in non-grandfathered individual plans that didn't meet these requirements. The development spurred Republicans to criticize President Obama, saying he had failed to keep his promise that Americans could keep their old health plans if they wanted under the PPACA.
Insurance industry members expressed concern about the president's decision to allow the extension of old plans, saying it could lead to fewer younger and healthier people purchasing coverage through the health insurance exchanges, causing premiums to increase. In line with those concerns, HHS has acknowledged that extending health plans that don't meet Patient Protection and Affordable Care Act requirements could lead to fewer healthy exchange enrollees and losses for health insurers.
More Articles on Health Insurance Coverage:
Moody's: PPACA Policy Changes Mean More Risk for Health Insurers
HHS: Extending Health Plans Could Lead to Losses for Insurers
Blue Cross Kansas to Extend 10K Health Plans