Here is an Insurer's explanation for those Policy Cancellation Notices, as explained on a rather informative FAQ:
Why Insurers Cancel Policies, And What You Can Do When It Happens
by Julie Appleby, Kaiser Health News Staff Writer, kaiserhealthnews.org -- Oct 30, 2013
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Q. Why am I getting this notice?
A. Most likely your plan didn’t meet all the standards of the federal health law. One type of policy being discontinued by Florida Blue, for example, did not cover hospitalizations or emergency room visits and paid a maximum of $50 toward doctor visits. It’s possible your plan also had deductibles and other potential expenses – such as copayments for doctors and hospital care -- that exceeded the law’s annual out-of-pocket maximum of $6,350 for individuals or $12,700 for families. Insurers may have just decided to end certain types of policies, something they have always had the ability to do. Some policies that fail to meet the law’s standards can still be sold, but only if the insurer decides to continue them and they are “grandfathered,” meaning you purchased one before March 2010 and neither you nor the insurer has made any substantial change since then. Adjusting an annual deductible, which many people do each year to keep down their premiums, is a change that could end grandfathered status.
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Q. My insurer says if I renew before the end of the year, I can keep my current plan. What does this mean?
A. In some states, insurers are offering selected policyholders a chance to “early renew,” meaning they can continue their existing plan through next year, even if it doesn’t meet all the law’s standards. If you choose this option, your premium may still go up, but the cause would be medical inflation, rather than the need to add benefits because of the health law. Not all states allow early renewals. Fearing insurers would offer such renewals only to their most profitable plans, a handful of states, including Illinois, Missouri and Rhode Island, barred insurers from doing it.
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Keeping the plan you got, may not always be the 'option' in your "best interests," however ...
Here's an Investigator's take on how some Insurers want to keep you locked into your old (grandfathered) Insurance policies, whenever they can 'scare' 'talk' you into to them.
Special Investigation: How Insurers Are Hiding Obamacare Benefits From Customers
by Dylan Scott, TMP, talkingpointsmemo.com -- Nov 4, 2013
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Across the country, insurance companies have sent misleading letters to consumers, trying to lock them into the companies' own, sometimes more expensive health insurance plans rather than let them shop for insurance and tax credits on the Obamacare marketplaces -- which could lead to people like Donna spending thousands more for insurance than the law intended. In some cases, mentions of the marketplace in those letters are relegated to a mere footnote, which can be easily overlooked.
The extreme lengths to which some insurance companies are going to hold on to existing customers at higher price, as the Affordable Care Act fundamentally re-orders the individual insurance market, has caught the attention of state insurance regulators.
The insurance companies argue that it's simply capitalism at work. But regulators don't see it that way. By warning customers that their health insurance plans are being canceled as a result of Obamacare and urging them to secure new insurance plans before the Obamacare launched on Oct. 1, these insurers put their customers at risk of enrolling in plans that were not as good or as affordable as what they could buy on the marketplaces.
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It's a tricky market out there, so watch out. Don't rush into anything.
Get informed. Shop around. And remember above all, Insurance Companies are still in business to make a profit -- higher standards notwithstanding. So buyers beware.
If only we had a Public Option instead of a 'Grandfathered Option', the choice for uninsured, and the self-insured, would be a no-brainer. 2-3% overhead on the Public plan vs 20% profit margins on the Private: which one would you think has/had your "best interests" in mind?
Receiving quality affordable Health Care, should be a 'public service' in a civilized society -- and not just another 'profit center' just waiting to be tapped, by the swift and the clever ... and the stone-cold heartless.
Remember, Insurers make a profit when they don't pay out on your policy, not when they do. So their motivations can often be slightly conflicted. The ACA is intended protect consumers from the worse of these private sector gain-taking games, which used to occur at our individual personal expense. Both health-wise and wallet-wise.
I can't remember when was the last time that a consumer-protection law, was fought so hard, and was so misunderstood, by the consumers it was trying to protect. Can you?
