Sandy Graham is the project manager and managing editor of Health Elevations, the Colorado Health Foundation's award-winning quarterly journal. The latest edition of Health Elevations focuses on changes in private insurance that are in the works or coming soon.
"You'd better look at this letter that came from our health insurance plan."
My husband's tone of voice did not bode well. I was just finishing the cover story for this issue of Health Elevations, detailing the big changes in private health insurance occurring through the 2010 federal health insurance reform bill, the Affordable Care Act: No denials for existing health conditions; Preventive care; Shopping for plans through an online insurance exchange; Covering adult children to age 26 on parents' policies.
Make that some adult children.
Ironically, despite all I had just written about the ACA's efforts to extend health coverage to more people, our daughter – the underemployed college graduate – would not be among them. The letter explained she was being dropped from our plan because she was no longer a full-time student – which we thought applied only to the "old days" before the ACA.
But when my husband called the plan, he was informed that the ACA does not apply to health plans such as ours, which is for retirees – not regular employees – of a large cable TV company.
Still puzzled, I contacted Marianne Goodland, the Colorado Division of Insurance's director of consumer education, and Karen Pollitz, senior fellow at the Henry J. Kaiser Family Foundation both of whom had helped on this issue of Health Elevations. They confirmed that letter was right: retiree-only plans did not have to comply with the ACA.
To me, it felt like the old bait-and-switch. What was going on?
Blame HIPAA, they said. The 1996 Health Insurance Portability and Accountability Act provides privacy protections for individuals' health information and helps preserve coverage for workers who change or lose jobs. HIPAA rules do not cover retiree-only plans. And the ACA was added to HIPAA. Therefore, the ACA does not cover retiree-only plans.
Congress would have to amend HIPAA to extend the ACA's promises to retirees and their families. This is opposed by businesses: According to an article in The Wall Street Journal, big employers say they might drop retiree coverage entirely if Congress were to do so.
The former employer did offer to continue covering our daughter through COBRA (the Consolidated Omnibus Budget Reconciliation Act). This would provide her with 36 months of coverage because of "loss of child dependent status" rather than the 18 months that the law offers following job termination. But the price tag was a staggering $489.24 a month for health coverage plus another $46 for dental and vision.
Instead, we talked to an insurance broker, compared several companies' offerings and ultimately chose a comprehensive plan (albeit, with a $1,500 deductible) for $143 a month that will let her stay with our family doctor.
On the plus side, when 2014 arrives, we should be able to buy our daughter an affordable individual policy through the ACA-mandated health insurance exchange – providing the exchange isn't nullified by lawmakers or the courts. Better yet, maybe she'll be gainfully employed with health insurance benefits to boot.
Only time will tell.