Patient advocacy group says health policy cancellations are being overblown

Posted by Tony Pugh on November 21, 2013 

US NEWS HEALTHCARE-ENROLL 4 MCT

Gary King, who owns the religious supplies store Miracle On Main Street in Stockton, Calif., had his health insurance cancelled because his policy was not in compliance of the Affordable Care Act. King will pay $68 more a month for insurance purchased on the California exchange.

GENEVIEVE ROSS — MCT

— A patient advocacy group that supports the Affordable Care Act is pushing back against the wave of media reports about policy cancellations involving people with individual health insurance.

Last week, facing mounting political pressure, President Obama announced that he'll allow these people to keep or renew their cancelled health plans if insurers and state insurance departments allow it.

In a new analysis released on Thursday, Families USA, says the outrage over the cancellations is being overblown.

"I don't mean to suggest that it doesn't deserve attention, I do think, however, that this issue has been blown out of proportion," said Ron Pollack, executive director of Families USA.

"The purpose of our report, quite frankly, and probably quite obviously, is to say 'if you continue to cover it, that makes sense. But keep it in perspective in terms of the overall impact of the Affordable Care Act.'"

Of the 15.2 million people with individual health insurance, the analysis finds that 71 percent, or 10.8 million people would either qualify for Medicaid or federal subsidies that would substantially offset the cost of new coverage purchased through the state and federal insurance marketplaces.

That's because those 10.8 million people are in households with incomes that are below the federal cutoff amount for federal assistance - 400 percent of the federal poverty level, which is about $46,000 for an individual or $94,200 for a family of four.

The other 29 percent, or roughly 4.4 million people with incomes above 400-percent poverty threshold are ineligible for premium assistance or Medicaid, the report adds.

So if one-third of these individual policy holders would leave the market within a year - as most individual policy holders do - that leaves roughly 1.5 million people out of 267 million Americans under age 65 who're at risk of losing their individual coverage and not receiving any financial assistance, the report finds.

"It's really important to remember that this is truly a tiny portion of the people that will be affected by the Affordable Care Act," Pollack said.

"Although President Obama was right to express his concern about, and to propose corrective action for, the people at risk of losing health coverage due to the Affordable Care Act, it is important to keep a perspective about the small portion of the population that might adversely affected," Pollack said. "That number is a tiny fraction of the 65 million non-elderly people with preexisting conditions who will gain new protections through the Affordable Care Act."

The report provided state-by-state breakdowns on the numbers of people eligible for subsidies, but it didn't say what percentage were likely to face higher premiums under the new marketplace policies that are required to have beefed up benefits and greater consumer protections.

"When people get better coverage, it is likely to mean they are going to pay somewhat higher premiums," Pollack said. "You don't get anything for nothing...However, if you're eligible for subsidies that are going to significantly reduce your premiums, that could more than make up for the increase in premium costs because you're getting better coverage."

The Families USA report is available at - http://www.familiesusa.org/ACA-individual-market/  

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