On November 14th, President Obama made an announcement that all
NON-GRANDFATHERED POLICIES that are being canceled as a result of the Affordable Care Act would get a one-year extension and in fact WOULD NOT be canceled as of 12/31/2013.
We have already been in touch with all our carriers. The carriers are aware of the development and are eagerly awaiting the formal regulations that will provide them the exact rules/regulations in order to be able to administer the new changes.
RESOURCE BROKERAGE’S TAKE:
- As a result of most carriers' renewal strategy of allowing groups the option to renew 12/1/13 or 1/1/14, we believe the impact in the group market will be minimal as most of the groups have already gravitated to the plan that most meets their needs.
- We believe the impact to be far greater in the individual markets; however, it is important to note that only approximately 50% of the policies in the state were NON-GRANDFATHERED and slated to be canceled.
- This extension appears to be an OPTION—not a mandate—meaning that Resource Brokerage does not believe that simply because of this announcement (that all NON-GRANDFATHERED POLICIES MAY keep what they have), it is not a blanket mandate. We do believe a percentage of policyholders still will migrate because they may benefit from some provisions of the ACA (for example, Premium Tax Credits, Subsidies, rider removals or aggregating split families’ members where some individuals of a family unit were insured with a private sector company and other family members were insured through CHIP).
RESOURCE BROKERAGE’S SUGGESTED COURSES OF ACTION:
- Contact all of your NON-GRANDFATHERED POLICYHOLDERS to explain these developments.
- Continue to do your client needs assessments to see if they fit into point 3 above; and if they perceive they can obtain better coverage with an ACA plan design, move forward with the ACA plan migration.
- If your clients do not like the new plan designs or premiums (and have no riders), we would suggest you NOT migrate them and wait for the carriers to inform you of their course of action once the necessary Federal regulations are released. Again, a presidential announcement is not enough to create policy or assure compliance so there is definitely more to come on this latest development.
- Watch the respective carrier updates as well as future Resource Brokerage Legislative Updates for further guidance on this matter!
We appreciate your business and the trust you place in us during this “interesting time” in American history!