In Stance on Renewal of Old Health Policies, States Run the Gamut

Just a few days after President Obama said that millions of consumers should be able to keep their old insurance plans for another year ? even if they did not meet the requirements of his health care law ? he is finding support among states that would not exactly be described as allies.

Of the 13 states that have so far said they will allow consumers to renew canceled plans, all but four are led by Republican governors and have generally been opposed to the new health care law. Of the eight that have said they will not carry out the policy, six are in Democratic-led states, many of which have actively worked to put the law into effect and have argued that allowing such an extension could undermine its success. They include New York, which announced its decision on Tuesday, and Massachusetts. Many other states, including California and New Jersey, are still weighing their options.

The new plans being offered under the Affordable Care Act require that insurers cover a wider range of benefits than many of the old plans. In addition, the insurers are prohibited from turning away people with existing medical problems or charging them more.

Mr. Obama’s announcement last week came after the political uproar prompted by millions of consumers’ receiving notices that their health plans were being discontinued because they no longer complied with the law.

Many states with low numbers of such cancellations were those that had let insurers temporarily avoid the law’s requirements by offering early renewal of existing plans. Those renewals allowed people to keep their existing plans though next year. The goal was to smooth the transition for consumers, commissioners in those states said.

“It turned out to be a good decision,” said Mike Chaney, the insurance commissioner in Republican-led Mississippi, who said fewer than 500 people in his state received notice of discontinued policies because he encouraged the major insurers to offer the option of renewing for an additional year.

Mr. Chaney said insurers could have chosen to cancel policies in his state anyway, but “I would have hammered them if they did.”

Several other Republican-led states, including Oklahoma, Utah and New Mexico, also reported few cancellations and cited their policies on early renewals as one of the reasons.

However, the final decision was up to insurers. For that reason, in some states that permitted early renewals there were still hundreds of thousands of canceled policies.

In Florida, Kevin McCarty, the insurance commissioner, said the state allowed insurers to offer customers the option of early renewal.

“If they liked their plan, they got to keep their plan,” he said paraphrasing a comment by Mr. Obama that has been often repeated by critics who say he broke his promise.

But Florida Blue, the state’s largest insurer, decided to discontinue the plans of about 300,000 people, including 40,000 whose coverage will end by Jan. 1. Now it is working to offer those customers the option of extending their plans for an additional year under Mr. Obama’s proposal, Mr. McCarty said.

Whether the move will ultimately be good for consumers is unclear. Proponents of the health care law, including several states that have most enthusiastically embraced it, have argued that renewing old plans will undermine the success of the fledging insurance marketplaces. They have also asserted that some of those plans have fewer benefits than new ones devised to comply with the new law.

There is also little indication of how many people who got cancellation notices will decide to renew. They may find better deals on the new insurance marketplace, especially if they qualify for tax-credit subsidies.

“I do not believe his proposal is a good deal for the State of Washington,” Mike Kreidler, Washington’s state insurance commissioner, said in a statement after the president’s announcement last week. Other states that have said they will not put Mr. Obama’s proposal into effect are Maryland, Massachusetts, Minnesota, Rhode Island, Vermont and Indiana.

Although New York said it did not plan to allow the estimated 100,000 canceled policies to be renewed, Gov. Andrew M. Cuomo did not completely close the door to the idea.

“If it is causing a problem for someone we will certainly look at it,” he said Monday. “Our program has actually been working well.”

California, which has an active state insurance marketplace, is scheduled to decide the issue on Thursday. Its insurance commissioner has supported Mr. Obama’s proposal, while the head of its marketplace has raised concerns about it. In California, insurers were required to cancel their noncompliant plans by the end of the year if they were also participating in the state marketplace.

Keith Cruickshank, who lives in the San Diego area, got a cancellation notice from his insurer, Kaiser Permanente, and said the new policy he found in the state marketplace for himself, his wife and their son would cost an additional $4,000 or so a year.

“We support Obamacare, but are being singled out because we are healthy and earning above the subsidy level,” Mr. Cruickshank said. If given the choice to renew his old plan, he says he would.

Still, there is no guarantee prices on those old plans will not also rise. Blue Cross Blue Shield of North Carolina announced Tuesday that it had filed documents with the state, which has said it will work to carry out Mr. Obama’s plan and allow about 230,000 customers to renew their noncompliant plans. But it also said that those customers would see rate increases of 16 percent to 24 percent.

For the states that choose to go ahead with Mr. Obama’s proposal, regulators and insurers must quickly work out tricky logistical details like approving rates for the coming year and working to return customers to their computer systems.

Some state insurance commissioners in states that were already allowing early renewals said they had a head start.

In Kentucky, which has generally embraced the health care law and has said it will carry out Mr. Obama’s proposal concerning canceled policies, regulators have already reviewed rates for insurers that offered renewals of their noncompliant plans. Therefore, they expect the process for state residents whose policies were canceled ? about 280,000 of them ? to be fairly straightforward.

“All of that regulatory due diligence that we had to do, we’ve already done it,” said Sharon Clark, the state’s insurance commissioner. “I feel for some of my colleagues who are having a much more difficult time than I am.”

Josh Katz and Keith Collins contributed reporting.