Covered California stumbles into new year

by Joseph Perkins | January 2, 2014 10:36 am

Manuel Arriola, co-owner of an Oxnard insurance broker, spent three hours and 15 minutes on the phone this past Monday with customer service representatives for Covered California[1].

He needed to find out whether or not insurance applications he forwarded to the state’s Obamacare health exchange by the Dec. 23 deadline had been successfully processed, and that the insurance policies his clients signed up for through Covered California actually would take effect on Jan. 1, as promised.

“Things are going to be chaotic,” Arriola told the Ventura County Star[2].

Indeed, there is no telling how many of the 400,000 enrollees Covered California claims will show up at hospitals or doctors offices in the new year thinking they have health insurance only to find out that they are uncovered.

“I can’t look into the future and tell you that every single person who signed up will have a smooth process,” Roy Kennedy, a spokesman for Covered California, told the Star. “That is certainly the hope.”

Meanwhile, some 900,000 previously insured Californians were left without policies for 2014 when Covered California’s five-member board voted unanimously in November not to grant the one-year reprieve the Obama administration was willing to allow for insurance policies that do not provide all the benefits Obamacare requires (but that cost considerably less).

“We know this transition is difficult and some people will be hurt,” Susan Kennedy, a Covered California board member[3], told the Los Angeles Times. But there will be far more than “some” people hurt, said Jamie Court, president of Consumer Watchdog[4], which has long supported Obamacare.

Half of those whose insurance policies were canceled because of the decision by Kennedy and her colleagues on the Covered California board are getting replacement policies, said Court, “that are little different from the ones canceled.”

Moreover, he said, canceled policyholders that sign up for approved policies under Covered California “are paying more, in some cases a lot more, for policies that are worth no more” than the policies they previously had.

‘Junk insurance’

Consumer Watchdog’s president dismisses the insinuation by officials at Covered California that the 900,000 policies canceled here in the Golden State were “junk insurance.”

“The fact is,” Court said, “canceled policies in California are, by and large, not junk.” Indeed, he noted, “physician and hospital networks under old policies are far broader than under the Covered California plans.”

So why did the Covered California board allow 900,000 insurance policies to be canceled as of New Year’s Day 2014, when the board could have extended the cancellation date to Jan. 1, 2015?

Board member Kennedy suggested the reason was because “delaying the transition wouldn’t solve a single problem.” But what she didn’t say is that Covered California desperately needs those 900,000 people to sign up for new policies through the state health exchange.

That’s because Covered California needs to increase its enrollment exponentially to avert a projected $78 million deficit for its 2015-16 budget, which begins this upcoming July 1. And according to the California State Auditor[5], “federal and state laws prohibit federal grants or the State’s General Fund to support ongoing operations.”

Source URL: https://calwatchdog.com/2014/01/02/covered-california-stumbles-into-new-year/

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