SANTA FE, N.M. (AP) — Most New Mexicans facing the cancellation of their individual health insurance will see no change because of President Barack Obama’s decision to allow private insurers to continue offering existing policies for another year.
The state’s two main health insurance providers, Presbyterian Health Plan and Blue Cross and Blue Shield of New Mexico, had previously developed transitional policies that give individuals more time to make the switch to a plan that meets benefit and coverage requirements of the federal health care law.
Presbyterian Health Plan president Lisa Lujan said Friday the company was moving ahead with a new coverage option that has been offered to 23,000 individuals whose policies are being discontinued because the plans don’t meet federal requirements.
Individuals can enroll in a new plan by Presbyterian through next month and its cost will be about 20 percent lower than what will be available through a federally operated health insurance exchange, she said. The cost is lower because the plan doesn’t offer all the benefits required under the Affordable Care Act and because the company knows the medical conditions of its existing customers for pricing purposes.
Of the nearly 29,000 individuals with Blue Cross and Blue Shield of New Mexico, about 11,000 already have been given the option of renewing their current health plans through much of next year. That approach was in place before the president’s announcement because the state’s insurance regulator previously agreed that the contract period could run from December through the end of November 2014.
About 18,000 Blue Cross and Blue Shield policyholders don’t have to make any change because they’re enrolled in older plans exempt from much of the health care overhaul.
Lovelace Health Plan said it’s reviewing the Obama administration’s announcement. Lovelace has 2,900 individuals whose plans are being cancelled at the end of the year.
The federal law requires policies sold starting next year to offer certain core benefits such as maternity care. Some of those benefits are missing from current policies, allowing individuals to pay lower monthly premiums.
The law also guarantees coverage to individuals regardless of their health conditions. Medical underwriting is abolished, preventing companies from charging higher rates to older, sicker individuals and less for younger, healthier policyholders.
Because of an outcry from individuals who had received cancellation notices and faced the prospect of higher prices for new policies, Obama announced Thursday that insurers can offer another year of coverage under existing individual plans, if that’s approved by state insurance regulators.
State Insurance Superintendent John Franchini said his agency was reviewing what it could do under state law.
“I think it could be really chaotic,” Franchini said. “But we have to look at it, and we have to study it.”