Health law's insurance plans for pre-existing conditions are slow to enroll; 3M to drop early retiree coverage

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Oct 4 2010

The Associated Press: "It's a centerpiece of President Barack Obama's health care remake, a lifeline available right now to vulnerable people whose medical problems have made them uninsurable. But the Pre-Existing Condition Insurance Plan started this summer isn't living up to expectations. Enrollment lags in many parts of the country. People who could benefit may not be able to afford the premiums. Some state officials who run their own "high-risk pools" have pointed out potential problems" (Alonso-Zaldivar, 10/3).

The Wall Street Journal: "3M Co. confirmed it would eventually stop offering its health-insurance plan to retirees, citing the federal health overhaul as a factor. The changes won't start to phase in until 2013. But they show how companies are beginning to respond to the new law, which should make it easier for people in their 50s and early-60s to find affordable policies on their own. While thousands of employers are tapping new funds from the law to keep retiree plans, 3M illustrates that others may not opt to retain such plans over the next few years" (Adamy, 10/4).

The Virginian-Pilot: "Employers and unions increasingly have struggled to pay medical bills for workers who retire" well before they are eligible for Medicare. A new health overhaul program "aims to reimburse some of those costs. ... Nearly 2,000 employers and unions -- including 45 in Virginia -- recently were selected to participate. They are supposed to begin receiving reinsurance payments on claims this month. The program is meant to end in January 2014" when early retirees will have the ability to purchase their health insurance through health insurance exchanges (Jeter, 10/4).

Kaiser Health News/NPR: A new health overhaul-related website that guides consumers who are shopping for insurance has predictably irked the insurance industry -- which is on rough terms with the White House. Their main beef is that the site presents data for the number of applicants each insurer has rejected. Robert Zirkelbach, a spokesman for America's Health Insurance Plans, called the numbers "fatally flawed" and told reporters that the "site includes denials due to mistakes such as folks applying for plans in the wrong state" and "applicants who ended up getting 'counter-offers' for other coverage — often at a different price" (Weaver and Marcy, 10/1).

The Hill: Karen Pollitz, the deputy director of HHS's Office of Consumer Support, says the data on the government's health insurance Web portal offer consumers a "pretty good measure" of their chances of being denied coverage. "'It's not perfect,' said Karen Pollitz, 'but it gives you a pretty good idea about what to expect in the marketplace today.' The comments come as America's Health Insurance Plans raises questions about the denial rates that come up on Healthcare.gov when consumers search for insurance in their ZIP code" (Pecquet, 10/1).

Bloomberg News: Companies that offer very limited health plans are also worried about a prohibition in the new health law on benefit caps and a requirement that plans would have to spend a high portion of their revenue on health services. "U.S. restaurants have asked the federal government to waive health overhaul rules that may force companies to abandon low-cost 'mini-med' plans that insure 1.4 million minimum-wage and part-time employees. Cigna Corp., the Philadelphia-based health insurer, has also asked for a waiver on behalf of its 'limited-benefit' customers, and expects to hear back soon from federal officials, Gloria Barone Rosario, a spokeswoman, said in an e-mail. She declined to name the clients involved" (Armstrong, Helm and Nussbaum, 10/3).

The Wall Street Journal: In a separate story, the Journal notes that some Democrats are questioning the companies' complaints. Sen. Jay Rockefeller, D-W.Va., chairman of Senate Committee on Commerce, Science and Transportation, on Friday asked "a health insurer that provides plans for McDonald's Corp. restaurant workers to disclose details of the plans to the Senate." He is seeking "five years of data explaining how much the carrier charges in premiums and spends on care, as well as the number of workers who reach the plans' annual benefit caps." The request follows coverage of McDonald's requests for waivers that would allow it to continue its "mini-med" plan (Adamy, 10/1).

The Toledo (Ohio) Blade: Small businesses are also worried about costs. "Detroit Stoker Co. prides itself on providing better benefits than most companies. The Monroe firm, which designs stokers and combustion equipment, offers fully paid medical, dental, and vision insurance to its 70 full-time employees as well as paid medical coverage for retirees. Company President Thomas Giaier is concerned that federal health reforms, which began taking effect last month, could cause the firm to revise its long-standing practice of paying for comprehensive health coverage" (Harrison, 10/3).

This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.