Insurers Win Policy Change on Children's Health-Care Coverage
America's Health Insurance Plan's Karen Ignagni
Chip Somodevilla/Getty Images
America's Health Insurance Plans President and CEO Karen Ignagni
America's Health Insurance Plans President and CEO Karen Ignagni Photographer: Chip Somodevilla/Getty Images
Insurers led by UnitedHealth Group Inc. and WellPoint Inc. can limit when parents buy child-only policies under an Obama administration ruling that will keep consumers from buying coverage only after their kids fall ill.
The advisory posted yesterday on the U.S. Department of Health and Human Services’ website allows insurers to implement “open enrollment” periods, outside of which families wouldn’t be able to purchase coverage.
Under the health law signed in March by President Barack Obama, insurers may not exclude sick children from coverage after Sept. 23. Health plans complained that some parents might take advantage of the policy, potentially driving up premiums for all consumers. Last week, state insurance officials reported that some insurers planned to end child-only plans in response.
The ruling “will help ensure millions of children have access to affordable health-care coverage,” said Karen Ignagni, president of Washington-based trade group America’s Health Insurance Plans, in a statement today.
Blue Cross Blue Shield of Florida, an insurer that had said it planned to close enrollment in child-only coverage, announced it would resume sales of the policies in light of the posting.
“This policy will ensure that children get the comprehensive coverage they need while avoiding this unintended consequence,” Scott Serota, president of the Blue Cross Blue Shield Association, an insurance trade group in Washington, said in a statement.
State Requirements
The guidance doesn’t specify when insurers must hold open- enrollment periods, how long they must be or how often they must be offered. State requirements would apply where they exist, according to the posting.
The policy will be monitored, and HHS said it will “issue further guidance on open-enrollment periods if it appears that their use is limiting the access intended under the law.”
“Some state insurance commissioners expressed concern that, without an open enrollment period that was widely communicated, people might wait until their children got sick to enroll them in coverage, causing plans’ costs to increase,” said Nancy-Ann Min DeParle, director of the White House Office of Health Reform, in a blog post. “We were concerned when last week, some indicated that insurance companies would choose to stop offering policies for children rather than cover kids with pre-existing conditions.”
UnitedHealth, based in Minnetonka, Minnesota, fell 39 cents, or 1.3 percent, to $30.39 as of 11:50 a.m. in New York Stock Exchange composite trading. The shares are little changed this year. Indianapolis-based Wellpoint fell $1.75 to $51.05.
To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net.
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