Obama to promote new health care laws while insurance companies decide to stop offering new child-only health plans

Obama to promote new health care laws

USA Today (9/22/10)

The White House calls the provisions a "Patient's Bill of Rights," and provides description of the changes:

Ban on Discriminating Against Kids with Pre-Existing Conditions:

Before reform, tens of the thousands of families had been denied insurance each year for their children because of an illness or condition. Starting September 23rd, plans cannot discriminate against kids with pre-existing conditions. In 2014, no one seeking coverage can be discriminated against because of a preexisting condition. Up to 72,000 uninsured children are expected to gain coverage by banning insurers from refusing them coverage due to a pre-existing condition. Coverage for up to 90,000 children will no longer exclude benefits because of a pre-existing condition.

Memo to: President Obama
From: Vigilant Grandpa
Re:  Please read the following before you once again tout the merits of health care reform and how life will be so much better for our children and grandchildren. They deserve better Mr. President and at the very least, they deserve the truth!

By N.C. Aizenman
The Washington Post
9/20/10

Some of the country's most prominent health insurance companies have decided to stop offering new child-only plans, rather than comply with rules in the new health-care law that will require such plans to start accepting children with preexisting medical conditions after Sept. 23.

The companies will continue to cover children who already have child-only policies. They will also accept children with preexisting conditions in new family policies.

Nonetheless, supporters of the new health-care law complain that the change amounts to an end run around one of the most prized consumer protections.

"We're just days away from a new era when insurance companies must stop denying coverage to kids just because they are sick, and now some of the biggest changed their minds," Ethan Rome, executive director of Health Care for America Now, an advocacy group, said in a statement. "[It] is immoral, and to blame their appalling behavior on the new law is patently dishonest."

Three insurers - WellPoint, Cigna and CoventryOne - all cited uncertainty in the health insurance market for their decisions. That incertitude and the resulting decision of other insurers to drop their child-only plans, according to WellPoint spokeswoman Kristin Binns, "has created an unlevel competitive environment."

CoventryOne spokesman Matthew D. Eyles said that the insurer was facing "unique challenges that could undermine our ability to offer value and meet our continued obligations to existing policyholders."

But officials of the Obama administration said the move contradicted a letter from the leader of one of the insurance industry's most important trade groups after the law's adoption in March. Karen Ignagni, president of America's Health Insurance Plans, expressed support for the law's provisions concerning children with preexisting conditions and promised to "fully comply" with them.

"We expect [insurance companies] to honor that commitment. Insurers shouldn't break their promise and turn their backs on some of our most vulnerable Americans," said Jessica Santillo, a spokeswoman for the Department of Health and Human Services.

Robert Zirkelbach, a spokesman for AHIP, noted that insurers will be accepting children with preexisting conditions in other types of plans.

But, he said, extending such coverage in child-only policies "provides a very powerful incentive for a parent to wait until their child becomes very sick before purchasing coverage."

Zirkelbach added that in 2014, when similar protections kick in for all individuals with preexisting conditions, virtually all Americans will be required to get health insurance.

With no such mandate currently in place, however, the result over the next several years could be that the pool of children insured by child-only plans would rapidly skew toward those with expensive medical bills, either bankrupting the plans or forcing insurers to make up their losses by substantially increasing premiums for all customers. And Zirkelbach said the effect could be compounded if only a few plans remain in the market.

It is unclear how many children will be affected. Child-only plans represent only a small share of the non-group plans available on the individual market - with somewhere between 100,000 and 700,000 children currently receiving such coverage, according to administration officials.

In some states that have separate requirements concerning child-only plans, insurers will continue to offer new policies - New York, Maine, Ohio and Virginia, in the case of WellPoint's Anthem Blue Cross and Blue Shield plans, for instance.

Most poor children with preexisting conditions already qualify for insurance through programs such as Medicaid and the Children's Health Insurance Program. And those who are not poor will be able to apply to new high-risk pools established by the law.