Virginia regulators say they may not have legal authority to require insurers to extend cancelled health policies as long as two years, as President Barack Obama requested last week.
The Bureau of Insurance instead asked insurance carriers today to give individual and small group market customers the option of renewing their existing policies early to extend coverage into 2014, as insurers already have done in many cases for people with policies that do not comply with higher standards under the Affordable Care Act.
Obama asked states last Thursday to give consumers the option of buying an additional year's coverage under policies that had been cancelled because they do not comply with the minimum essential benefits and other new insurance underwriting standards required of policies sold after Jan. 1 under the federal health care law. The president made the request in response to a political furor over the cancellation of policies after his repeated assurance they would be able to keep their existing insurance if they wanted under the law.
That proposed change, which blindsided both insurance carriers and regulators, would allow consumers to keep non-compliant individual market and small-group plans as long as Oct. 1, 2015, the bureau said.
However, after analyzing the new state law that incorporated the insurance standards of the Affordable Care Act, state insurance regulators said "it is unclear whether the bureau has the authority to implement the president's recommendations."
"What is clear is that Virginia insurance law does permit the Bureau of Insurance to allow carriers to offer early renewal of existing insurance plans in the individual and small business group markets so that policyholders may continue existing coverage into 2014," the bureau, part of the State Corporation Commission, said in a statement today.
Some insurers, including Anthem Blue Cross and Blue Shield, the state's largest, already have offered individual and small-business policyholders the option of renewing their existing policies early instead of buying new policies that comply with the standards of the federal health care law.
The Bureau of Insurance asked insurance carriers today to "reoffer" renewal of coverage through the end of 2014 and also encouraged "any carriers who have not offered the option to extend coverage through the end of 2014 to make such extensions available."
The state agency urged consumers to consider early renewal among the other options they are considering for health insurance coverage next year, when coverage purchased through the new federal health insurance marketplace will take effect.
The full statement released on 11/20/2013 by the Virginia Bureau of Insurance can be read here.
