Insurers, State Search for Answers Following Obama's ACA Proposal

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When President Obama stepped to the podium to announce changes to the Affordable Care Act, it was news to the companies that had to make those changes.

Obviously at this point we weren't prepared to handle that," said Caleb Buhs of Michigan's Department of Insurance and Financial Services. "So we are looking into all the details of the change itself and how it pertains to our state and what we can do to help inform people about what they need to know now going forward."

DIFS is one of the groups tasked with making the President's proposal a reality in Michigan.

President Obama announced he will allow consumers to keep their plans that may have been canceled to comply with the language of the Affordable Care Act. It's not a requirement though and states, together with insurance companies, are tasked with examining their insurance plans and deciding whether or not to proceed.

"It's not that simple," said Buhs. "There's a lot of changes that have a cascading effect and we're not sure yet of the rules and regulations that have to apply to this and how it intertwines with the laws in our state. So there's a lot we have to examine."

Blue Cross Blue Shield of Michigan said the plan could affect 200,000 policyholders in the individual healthcare market. Vice President of Communications Andy Hetzel said the company is reviewing all possible options before deciding what to do.

"We heard, in the first hour after the president spoke, from about 300 of our individual policy holders who called us and said 'What does this mean to me?'" said Hetzel. "At this point we can't answer those questions until we examine what our options are."

One option is reinstating plans that had to be canceled under the 2010 law because they didn't meet federal standards. Consumers would have at least another year on their current plans. The other alternative is continuing on as before -- offering only federally-compliant plans or pushing people to the federal healthcare marketplace to find one.

"It's taken us two-and-a-half years to get to a point where we could offer plans in the marketplace that met the requirements of that law," said Hetzel, "and now the President has come forward with yet another set of requirements that we need to consider the impact of to move forward."

But Don Hazaert, director of Michigan Consumers for Healthcare, which helped implement the federal regulations in Michigan, said he expects most companies will soon realize that the most comprehensive and affordable plans will be the ones found on the federal marketplace.

Regardless of the way the state decides to proceed, Michigan Association of Health Plans Executive Director Rick Murdoch says the damage may have already been done. He called the situation "very disruptive" to the insurance industry and likely to increase costs across the board.

Insurance companies continue to encourage consumers to explore all their options if they want a plan to take effect by January 1, 2014.

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