Iowa will extend non-compliant ACA health plans

Iowans who may have lost their insurance policies this coming fall now have the option to keep them. That will be possible now that the Iowa Insurance Division announced on Wednesday that it will extend non-Affordable Care Act (ACA) compliant plans until October 2016.

'We have concerns about policy cancellations and the anxiety Iowans face when they receive cancellation notices,” the insurance division said in a news release.

Insurance companies sent letters to millions of Americans this past fall informing them their plans would be canceled because they did not meet standards put into place under the ACA, which required plans to cover maternity leave and mental and preventive health as well as other benefits.

The Obama administration - which promised Americans that if they liked their insurance, the could keep it - quickly worked to appease these policy holders. In March, it told states they could choose to continue certain coverage that would otherwise be canceled.

'Iowans deserve predictability and stability in their health care coverage,” said Gov. Terry Branstad in a statement on Wednesday.

About 330,000 individual and small group members will be affected by the extension, according to the governor's office.

As of Tuesday, 18 other states have taken similar action allowing plan extensions.

The decision greatly affects Wellmark Blue Cross and Blue Shield, Iowa's largest insurer, which said it would extend health plans shortly after the insurance division made its announcement. The company said up to 300,000 of its members could be affected.

Wellmark offered an extension in 2013, and said that more than 90 percent of Wellmark individual policyholders and 85 percent of small business groups chose to keep and extend their plans through 2014.

'Preserving this option means that our members can continue to keep the health insurance plans they want, know and trust while still having the flexibility to move to new ACA plans if those would better meet their needs,” said Wellmark Chairman and CEO John Forsyth in a statement.

Traci McBee, spokeswoman for Wellmark, said the company's non-ACA health plans still provide quality coverage.

'In fact, the material differences between an ACA plan and Wellmark's non-ACA plans are certain mental health and maternity benefits,” she said. 'Many of these plans were chosen by members because they do not need these benefits and do not want to pay for it.”

The Insurance Division acknowledged the ruling could result in a small price increase and unsettle the insurance exchange marketplace by creating a two tracks - one pool with compliant plans and one pool without.

Not everyone was pleased with the announcement.

'We're obviously disappointed with the decision,” said David Lyons, CEO of CoOportunity Health, a not-for-profit health insurance co-op offering plans on the state exchange. 'Iowa is already one of the lowest performing states on the federal marketplace, and this just won't help.”

CoOportunity Health now has 71,000 members in Iowa and Nebraska.

Lyons said this decision affects thousands of Iowans on both sides of the equation because these two pools will create instability in the marketplace as well as put pressure on compliant plans, raising costs.

'This is another example of how the rules are continually changing after they've been in place,” he said ”It creates a very difficult and unstable market.”

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