Last week President Obama said he would allow health insurance companies to extend plans canceled by the Affordable Care Act (ACA) but the decision would ultimately fall on the states.
On Friday, Ann Flood, director for the department of insurance and financial services, announced she will allow health insurers to extend their 2013 plans through 2014 under the policy change to Obamacare.
Michigan joins at least a dozen other state that have already agreed to allow insurance companies to extend coverage.
"We really are trying to provide consumer choice in the midst of a lot of confusion on the federal marketplace right now," Flood said.
Considering only about 1,300 Michiganders successfully signed up for insurance on the Healthcare.gov website last month, Flood said the faulty launch of the federal website played a big factor in Friday's decision.
"The access to the federal website has been very difficult for our consumers... and come January 1 we want to make sure as many Michiganders are enrolled in healthcare one way or the other as possible," she said.
But while the plan is meant to belatedly fulfill President Obama's promise to allow people to keep their current coverage, it might not actually be the solution individuals are looking for, according to Don Hazaert, director with Michigan Consumers for Healthcare.
"This muddies the waters," Hazaert said. "Some now have to make decisions whether they want to go back and try to continue these plans or not."
"But the bottom line is most insurance companies had the option to continue a lot of these plans and weren't planning on continuing them anyhow."
Hazaert said Friday's decision could be rendered moot if most insurers opt out and he argues the government's best option would've been to continue forward as originally planned.
"This is similar to taking off a band-aid.. do you just want to rip it off and move forward quickly or do you want to pull it off slowly," he said.
"It's more painful to pull it off slowly, the ideal option would be to... move forward as far as where we're going with healthcare in this country."
As of Friday night, the only insurance provider to respond to the announcement was Blue Cross Blue Shield of Michigan.
In a press release the provider said it would not be allowing policy holders to extend their current coverage, but would continue to help individuals transition into their only 'pre-Obamacare' plan until individuals could enroll into an ACA compliant plan.
Insurers that extend their 2013 plans are required to allow all policyholders to keep their coverage, according to the Michigan Association of Health Plans.