By D. Kenton Henry
Don’t worry. This doesn’t apply to you if you have coverage through an employer’s group plan. But if you (like myself) are one of 370,000 insured members with an individual or family health insurance plan―be prepared to choose your provider from a different menu. And rest assured it will be portion controlled.
BlueCross will continue to offer Health Maintenance Organization (HMO) Plans where you must elect and utilize a provider within their HMO network or you will have no coverage whatsoever. This is where rationing begins. With your provider. You can expect the number of doctors and hospitals to be significantly limited relative to the selection currently available to you in the Preferred Provider Organization (PPO) network where you may go in or out of the network at your discretion and still be covered. Although details are yet to be unveiled, these HMO plans will most likely require you to select a “Primary Care Physician” with whom all medical care must be initiated. If so, you will have to obtain a referral from that primary care provider in order to see a specialist. And that is where rationing of care continues. With your treatment. HMO providers have contractually agreed to accept a lower payment in return for providing you treatment in the first place. Referring you (away) to a specialist results in a total loss of payment.
BlueCross explains they paid $400,000,000 more in claims then they collected in premium from their PPO members in 2014. And they add (exclamation point mine) “that is unsustainable!” Their rationale is―the insurance company will be better able to “manage” the care we members receive and what we are charged for care, helping to reduce health insurance premiums. Those currently enrolled in a “grandfathered” (written prior to the March 2010 passage of the Affordable Care Act) plan or HMO network policy will be happy to know you will probably be able to maintain your coverage option (deductible, co-pays) into 2016, assuming the premium remains affordable. Those, like myself, who want total discretion as to our providers are certain to be disappointed.
This begs the question: What will our options be with other insurance companies? Unfortunately, like BlueCross, most companies are yet to reveal the details of their policies. I will be introduced to these changes over the remainder of October and―rest assured―whatever your best options are for 2016―I will have them. And you will be able to elect them with the beginning of OPEN ENROLLMENT (OE) November 1st―through the end January 31st. If you involve me, I will take into consideration your providers and do my best to find an affordable plan which allows you to continue to utilize them. If this entails you qualifying for and needing a premium subsidy from Healthcare.gov―I will assist you in navigating that process and serve as an advocate in your behalf. As I have done for 29 years this month, my objective is to ensure you obtain and maintain your best possible health care coverage at the lowest cost. Even in this age of increasing insurance premiums and less provider options.
Please refer to the featured article below and, lastly, to the Questions And Answers at the end of today’s post. Additionally, do not hesitate to call me or email me in order to prepare for these coming changes.
D. Kenton Henry (Editor, Agent, Broker)
Office: 281.367.6565 or Toll Free: 800.856.6556
Blue Cross to drop PPO plan covering 367,000 Texans
SAN ANTNIO―EXPRESS NEWS
By Peggy O’Hare
July 27, 2015 Updated: July 27, 2015 8:34pm
Blue Cross Blue Shield of Texas is eliminating in 2016 its…
Health insurance carrier Blue Cross Blue Shield of Texas next year will eliminate a PPO health plan that 367,000 consumers statewide now depend on for health benefits.
The company’s decision to drop its Blue Choice PPO plan will affect only customers in the individual market — not those covered by Blue Cross PPO group plans through their employers. About 148,000 consumers whose PPO plans were grandfathered in 2010 also won’t be affected.
The change is being made because the insurance company paid out $400 million more in claims than it collected in premiums for its Blue Choice PPO product in 2014.
“We felt like the PPO was not going to be a sustainable option,” said Dr. Dan McCoy, chief medical officer and divisional senior vice president for Blue Cross Blue Shield of Texas.
The move will not interrupt customers’ coverage before the end of the year.
The insurance carrier expects to offer another product when open enrollment for 2016 begins Nov. 1 in the individual market. No details on that new product were available Monday since it still is awaiting federal approval. Consumers won’t be able to view and compare their options on the federal exchange until Oct. 10, the company said.
“A new product has been filed that we believe will give you a flexible choice for your clients,” Blue Cross Blue Shield of Texas said in a communication to insurance brokers last week. “We will be able to share information about that product if and when it is approved by the Centers for Medicare & Medicaid Services closer to open enrollment.”
The carrier has not yet started sending notices to customers affected by the change, aside from posting a general notice on its website, a spokeswoman said. However, they should receive notices by early October.
Only a small fraction of the carrier’s total 5.5 million customers in Texas are covered by individual Blue Choice PPO plans, but the product has proven popular with consumers who want flexibility on which doctors they can visit.
Loretta Camp, an independent health insurance agent at Davidson Camp Insurance Services and a member of the San Antonio Association of Health Underwriters, said she is bracing for a flood of questions from consumers.
“We pretty much expected there to be just a huge amount of feedback,” Camp said of Blue Cross’ announcement, “and we’ve gotten hardly any. I don’t think people have really grasped what that means.
“It‘s a huge impact to my client base,” Camp said, noting that 88 percent of her customers buying health plans for themselves or their families inside or outside the federal exchange selected PPOs — preferred provider organization plans that allow consumers greater freedom on which doctors to visit.
Customers with PPOs pay lower rates if they use doctors or hospitals considered to be “in network” and incur additional costs if they see providers “out of network.”
Such plans are generally pricier than the more restrictive HMOs — health maintenance organization plans that only cover care from doctors and hospitals “in network” and won’t cover services outside the network at all unless it’s an emergency.
“We have a number of clients that moved … to a PPO plan because they were having difficulty finding providers that would take the HMO plans,” Camp said.
In its communication to brokers last week, Blue Cross acknowledged there will be some physicians and providers no longer considered “in network” as a result of individual Blue Choice PPO plans being discontinued.
“The number of providers not in network due to the discontinuance may be greater in 2016,” said the notice to brokers. “We have ensured that we have an adequate network to provide the physicians and hospitals needed to serve our retail members in each market, and we continue to have discussions with additional providers.”
Keeping the individual PPO plans intact and raising the price would have forced the insurance company to raise everyone’s rates in the individual market.
Under the Affordable Care Act, “individual business is rated using a single risk pool, meaning all individual plans had to be looked at together,” the carrier said in its notice to brokers last week.
Like most carriers, Blue Cross was venturing into uncertain territory when the Affordable Care Act made health insurance available to everyone beginning in 2014, McCoy said.
“This is really a new era in American insurance,” McCoy said Monday. “And clearly we entered this marketplace with not a lot of information.”
That meant serving a large number of new customers and complying with the new federal law. “This was a group of people, many of which had never had health insurance before,” McCoy said of the new beneficiaries, “coupled with the Affordable Care Act that contained a lot of new provisions and additions to care.”
“You combine that with the fact that health care costs in the United States have continued to grow. So clearly the premiums were not enough to make up for the health care expenditures that occurred.”
Blue Cross officials sidestepped questions Monday about whether it will continue selling its Blue Advantage HMO plans in the individual market in Texas next year. The company also declined to say how many consumers now now covered by Blue Advantage HMO plans, calling that proprietary information.
However, the federal HealthCare.gov website shows the carrier requested a rate increase of almost 20 percent for its Blue Advantage HMO plans in 2016. That proposal is still under review by the Centers for Medicare & Medicaid Services. Blue Cross officials wouldn’t comment.
Blue Cross Blue Shield of Texas noted it was the only insurance carrier to offer a PPO product in all 254 counties in Texas during the first two years of open enrollment in 2014 and 2015. Company officials said they will continue to offer other options in all 254 counties both inside and outside of the marketplace.
QUESTIONS AND ANSWERS:
What to Expect for Open Enrollment for 2016 Plans
Jul. 23, 2015
We’re getting ready for Open Enrollment for 2016. Blue Cross and Blue Shield of Texas (BCBSTX) will offer individual coverage options in every market in the state, both on and off the exchange. If you have an individual health plan or are looking to buy one in 2016, here are some of the changes you need to know.
When is Open Enrollment?
Open Enrollment for individuals runs from November 1, 2015 through January 31, 2016. If you are looking to buy your own health insurance plan for 2016, you can do so during this time.
If you already have health insurance, this is also the time you can:
- Look at other plan choices
- Compare plans and prices
- See if you can get financial help
You’ll be able to see what plans will be available starting in October, when the “window shopping” period begins. This will give you time to weigh your options, ask questions and decide what will work best for you – before it’s time to sign up.
What will be different for individual plans in 2016?
There are some changes in the plans we intend to offer in the individual market in 2016. We won’t be offering PPO insurance plans in the individual, retail market. However, we intend to continue to offer HMO plans. This change does not affect our employer group customers or the grandfathered PPO individual plan members.
Why is Blue Choice PPO going away?
BCBSTX was the only insurer to offer an individual PPO insurance plan across the state to individuals in 2014 and 2015. Since the Affordable Care Act began, the market has changed. We found that the individual PPO plan was no longer sustainable at the cost it was being offered. Because we want to make sure that our plans are affordable, we decided to not offer individual PPO plans in 2016.
Why couldn’t you just keep offering the individual PPO plans and raise the rate for them?
The law requires that we set our individual plan rates based on all of our individual members’ claims history. This means that if the costs of one plan are high, it will raise the rates of all other plans, not just the high-cost plan. If we kept the Blue Choice PPO, this would have raised the rates so much for all our other plans that most people wouldn’t be able to afford them. By dropping the PPO, we can still offer our other plans at reasonable rates.
I have a PPO plan. What will this mean for me?
If you have an employer group PPO plan, this will not affect you. If you enrolled in the individual Blue Choice PPO plan last year, you won’t be able to keep your PPO plan in 2016. We’re sharing this information well in advance of the required notification date so that you have plenty of time to research the plan options that best suit your needs. We will work with you and your doctors to lessen the impact of this change to your ongoing care.
My Blue Choice PPO plan is “grandfathered.” Is it being discontinued too?
No. If you have a grandfathered individual PPO plan, it will still be available in 2016. Grandfathered individual plans are plans that existed on March 23, 2010, when the Affordable Care Act became law. If you don’t know if your plan is grandfathered, check your plan details or call the customer service number on the back of your BCBSTX member ID card.
Will I be able to keep my doctor and/or hospital if I switch plans?
Currently, we have two provider networks for our individual plans: Blue Choice PPO and Blue Advantage HMO. Some providers are only in the Blue Choice network, and some of them have decided not to join the Blue Advantage HMO network in 2016. So, with the Blue Choice PPO individual plans going away, these providers will no longer be an in-network option for most of our individual members. If you have a grandfathered plan, you will still have access to the Blue Choice network.
If your doctor is not in the Blue Advantage network, we will work with you and your doctor to lessen the impact of this change to your ongoing care.
When can I see 2016 plan details and rates?
Individual plan details and rates will be available in October 2015. Open Enrollment begins November 1, 2015