Blues insurers will extend low-cost plans in Pa.

Blues insurers will extend low-cost Special Care plans in Pa. after they were to end in 2014

Associated Press

HARRISBURG, Pa. (AP) -- Pennsylvania's four Blues insurers will extend the life of their cut-rate, bare-bones insurance policies for the working poor after planning to end them Dec. 31 because they do not meet the requirements of the 2010 federal health care law, Gov. Tom Corbett's administration said Tuesday.

The announcement on the Special Care programs came nearly two weeks after President Barack Obama asked states to allow insurers to reverse policy cancellations stemming from the law.

Pennsylvania Insurance Commissioner Michael Consedine said his agency asked the nonprofit Blues insurers how to help the low income or sick who were seeing their policies canceled amid the broader difficulties for people who were trying to shop for coverage through the poorly functioning Healthcare.gov website.

The insurers responded by proposing extending the "Special Care" policies they subsidize for the working poor, Consedine said.

Policies sold through the Healthcare.gov website, a gateway to the health care law's insurance marketplace, promise far broader coverage than the Blues' Special Care plans and have rates subsidized by tax credits that are supposed to make them more affordable for lower- and medium-income families. They are also open to people with pre-existing conditions, and the Blues insurers say that the policies represent broader coverage possibly for less money than their bare-bones plans that do not comply with the law.

The change announced Tuesday could affect more than 30,000.

Philadelphia-based Independence Blue Cross, Pittsburgh-based Highmark and Blue Cross of Northeastern Pennsylvania will extend coverage through June 30. Capital Blue Cross said it will extend coverage through March 31. Independence Blue Cross and Highmark said they will seek approval from the state for rate increases.

All told, the state Department of Insurance has estimated that 250,000 Pennsylvanians, including people in individual, small-group and large-group policies, have received cancellation notices in recent weeks because of the law, and another wave of small group policyholders could see such notices next year, it said.

Pennsylvania is relying on a federally run insurance marketplace, like 35 other states, because Corbett, an opponent of the health care law, declined to take on the task. Signup rates for people seeking insurance have been higher and online glitches fewer in states running their own programs.

To qualify for the tax credits that subsidize insurance plans sold on the marketplaces, people must earn between 100 percent and 400 percent of the federal poverty level, or between $23,550 and $94,200 annually for a family of four. They must also not be eligible for affordable coverage from an employer or from Medicaid or Medicare.

Many childless adults in Pennsylvania with incomes below 100 percent of the federal poverty level — $11,490 for a single person — will not be eligible for a tax credit subsidy or for Medicaid beginning Jan. 1 because Corbett and the state Legislature didn't approve a Medicaid expansion envisioned by the health care law.

In the meantime, Corbett is asking the Obama administration for permission to use federal Medicaid expansion dollars to help newly eligible adults up to 133 percent of the poverty level to get a private insurance plan through the marketplace.

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