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Health policy extension war rages on

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The health policy extension fight continues to split state insurance commissioners, create divisions within states and keep analysts busy.

Members of the board of Covered California voted unanimously Thursday to stick to a decision to ask carriers to cancel all policies that fail to meet Patient Protection and Affordable Care Act quality standards by Dec. 31, 2013. The PPACA standards are set to take effect Jan. 1.

California Insurance Commissioner Dave Jones had asked carriers in the state to let individual and small-group policies that fail to meet PPACA standards stay in place in 2014, in accord with a non-PPACA policy extension proposal the Obama administration released last week. 

The Covered California board believes sticking with the original cancellation deadline will help protect consumers from having to meet two plan deductibles and help carriers stabilize the individual market risk pool, exchange officials said.

Covered California will try to ease the effects of any exchange program problems by pushing the enrollment deadline for coverage that takes effect Jan. 1 back to Dec. 23, from Dec. 15, and the payment deadline to Jan. 5, from Dec. 26, officials said.

In other policy extension news:

Several insurance commissioners in other states came out with their own extension proposal decisions. Idaho and North Dakota will encourage carriers to continue policies; officials in Indiana called the administration’s request for a change in rules “untimely” and denied it.

The Center for Consumer Information & Insurance Oversight—the arm of the Center for Medicare & Medicaid Services in charge of many U.S. Department of Health and Human Services PPACA implementation efforts—posted a model policyholder notice and a set of answers to frequently asked questions for states allowing extensions. A carrier must use the exact notice language approved for its state and send the notice to customers separately from any other plan correspondence.

Linda Rowlings, chief compliance officer at United Benefit Advisors, wrote in a commentary that it looks as if carriers that continue non-PPACA policies still must meet some new PPACA requirements, including a requirement that limits eligibility waiting periods to 90 days, a provision that removes pre-existing condition limits for adults in the group market, and a requirement that health plans satisfy health non-discrimination rules. 

Hans Leida, a Milliman consultant, said he believes the extended plans will not, technically, be “grandfathered.” It looks as if the policies might be subject to PPACA standards that have already started to apply to those policies, such as a requirement that plans cover basic preventive services without imposing out-of-pocket costs on the patients.

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