White House officials said a letter going to state insurance commissioners will specify that current plans will not be considered out of compliance with the federal health insurance overhaul law next year. It will be up to state regulators and insurance companies to decide whether to keep alive previously canceled policies.
Twenty-one companies terminated 183,821 individual and group health insurance policies affecting 473,724 people by late October, according to figures collected by North Carolina's Insurance Department. Blue Cross Blue Shield of North Carolina issued 151,640 cancellations, followed by 20,370 by Coventry Health and 4,459 by Aetna. Aetna bought Coventry this year.
Blue Cross spokesman Lew Borman said Thursday it was too soon to say how the non-profit insurer would respond.
"We had already been actively exploring options to provide some relief to customers who were faced with losing a plan they liked," Blue Cross president Brad Wilson said in a statement.
An Aetna spokesman had no immediate comment about its plans following the Obama Administration's surprise announcement. Blue Cross and Coventry are the only two insurers selling policies in North Carolina on the federally operated insurance marketplace created by the overhaul law.
It's not clear whether state Insurance Commissioner Wayne Goodwin would approve an insurance company's plan to reverse its policy cancellations. Goodwin did not respond when asked through a spokeswoman whether reversing policy terminations are practical now that notices have gone to policyholders. Goodwin said he is studying the issue and hopes to decide soon.
"My staff and I are gathering information and analyzing the options available to us at the state level to best protect North Carolina consumers," Goodwin said in a prepared statement.
Seven companies notified the Insurance Department they were withdrawing from the state's health insurance market. The rest offered replacement policies when terminating policies that didn't meet the new standards of the federal law. Canceled policyholders also could shop for replacement plans on the federal insurance marketplace, but its website has been plagued by glitches so severe that fewer than 27,000 people enrolled in October in 36 states that use the Washington-designed exchange.
The U.S. Department of Health and Human Services said this week that about 1,700 North Carolina residents successfully signed up for health insurance plans on the troubled website in the first month of open enrollment.
The government says about 15,000 North Carolina residents who went through the application process learned they were eligible for financial subsidies to buy coverage. Another 7,400 people were determined to be eligible for Medicaid, the government health insurance program primarily for children and the disabled.
North Carolina Sen. Kay Hagan, a Democrat who is facing a difficult re-election race next year, said the one-year fix isn't sufficient for affected consumers.
"We still need to work towards a permanent solution so we do not simply kick the can down the road," Hagan said in a statement. Hagan was one of 16 Democratic senators facing election next year who met with Obama last week to discuss constituent displeasure over the fumbled start.