‘Obamacare’ – a work in progress

An open letter from Washington State Insurance Commissioner Mike Kreidler

In January, the biggest changes under health care reform – or “Obamacare” – will take effect. Many health plans, which now have to comply with federal standards, will be significantly better. And hundreds of thousands of low- and middle-income Washingtonians will qualify for subsidies to help pay for coverage.

This fall, Washington’s new Health Benefit Exchange will open for business, giving consumers an easy way to compare health plans, sign up, and see if they qualify for the subsidies.

Many kinds of insurance policies, before they can be sold, must be reviewed and approved by my office. This is a very important consumer protection, designed to ensure that prices are fair and that insurers can deliver on their promises.

I’m pleased to report that based on state and federal law, we were able to approve 31 health insurance plans, from four carriers, for the Exchange. People shopping on the Exchange will have broad choice and significantly better coverage, starting Jan. 1, 2014.

Unfortunately, we had to reject applications from five other insurance carriers. These were not decisions I made lightly. I am a strong supporter of competition and consumer choice, and a longtime supporter of health care reform.

As the state’s insurance regulator, however, I have a duty to protect consumers and to hold all insurers to the same standards. There were substantial problems in the plans we rejected. Health insurers must have adequate networks of doctors and other health care providers. And there were major problems with the networks of most of the rejected plans. One didn’t offer any pediatric hospital.

Another had no approved retail pharmacy. Certain plans didn’t have adequate access to transplant surgeons, or to HIV/AIDS specialists.

One network would have required people to drive more than 45 miles to see a cardiologist, and more than 120 miles to see a gastroenterologist. That would be like living in Tacoma but having to see a doctor in Bellingham. These were not minor technicalities. They were major problems.

Some people have pointed out that three of the carriers whose plans were rejected are currently serving people on Medicaid. They worry that people whose incomes rise, making them ineligible for Medicaid, will have difficulty moving to a regular commercial plan, or would lose important continuity of care offered by the community clinics. Many of these community clinics offer important services, such as language assistance or transportation.

Rest assured: The plans I approved for the Exchange include a substantial number of community clinics throughout the state. In many cases, Medicaid patients who want to remain with the same clinic will be able to.

The Affordable Care Act requires all carriers participating in the Exchange to contract with an adequate number of “Essential Community Providers,” or ECPs. These are defined as health care providers that serve high-risk, special needs and underserved individuals. Many Sea Mar clinics, for example, have contracts with the commercial carriers who were approved for the Exchange.

My staff and I worked very hard to try to get all carriers and all plans across the finish line in time. We had dozens of meetings, and 14 webinars to try to walk them through the process. I called one CEO after another, laying out the key issues and timelines. On the final night, July 31, we had staff waiting at their desks until midnight, in order to give the companies every possible minute to succeed.

But some carriers – particularly those new to the commercial insurance market -- simply couldn’t meet the standards this time.

We knew this first big year of health reform implementation would be a bumpy ride, and it has been. But I remain optimistic about the future. We will continue to work with all carriers to help them get ready for the next year, when I fully expect more insurers to succeed.

In the meantime, consumers have a broad number of choices. The insurance is meaningful, the networks robust, the subsidies significant. Again, the process has been bumpy. But it’s a very promising start.

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