Canceled, out-of-state health insurance plans would be allowed under Senate bill

Staff writerFebruary 4, 2014 

The Insurance Building on the Capitol Campus in Olympia is shown Jan. 3, 2013.

TONY OVERMAN — The Olympian Buy Photo

Not all Washington residents may have been able to keep their health insurance plans from last year, but one state lawmaker wants to let people get their canceled plans back -- or at least, go shopping for insurance elsewhere.

A bill in the state Senate would let insurers continue to offer plans that were discontinued after the October rollout of the federal Affordable Care Act, and would also allow customers in Washington to buy health insurance plans from carriers in other states.

Senate Bill 6464 would allow health insurance carriers to continue offering insurance plans that don’t meet federal and state requirements, but only to customers who were enrolled in such plans as of Oct. 1, 2013.

The measure, sponsored by Republican state Sen. Steve O'Ban of University Place, would also let insurers from other states sell plans to Washingtonians without requiring the out-of-state carriers to meet Washington's insurance regulations.

O’Ban said he wants Washington residents to have the option to keep high-deductible plans that mainly cover catastrophic injuries, many of which don’t meet the standards set by federal and state health care reforms. Such plans have largely disappeared in Washington since the debut of the state’s health insurance exchange in October, he said.

Although President Barack Obama said in November that insurers could extend discontinued plans for another year, state Insurance Commissioner Mike Kreidler said he would not let carriers in Washington do so.

“A number of people face cancellations of policies and are unable to replace them,” O’Ban said during a committee hearing for his bill Tuesday. “This is an effort to try to implement what the President himself suggested we do, and that is allow people who are having difficulty finding replacement insurance to get that insurance that is available across state lines.”

Several individuals testified Tuesday about how their health insurance costs have increased since the October rollout of the Affordable Care Act, and how the minimal-coverage plans they once purchased no longer are an option on the state’s insurance marketplace.

“We need to do something for the residents of Washington state so we can survive,” citizen Bill Chandler told members of the Senate Health Care Committee. “This is something that will give us options we desperately need.”

But representatives of the insurance industry and the Office of the Insurance Commissioner said that letting people purchase out-of-state plans and canceled plans could upset the state’s new insurance marketplace.

Sydney Zvara, executive director of the Association of Washington Healthcare Plans, told committee members that O’Ban’s bill would put insurance carriers in Washington at a competitive disadvantage, since they would only be allowed to offer plans that meet state standards. Meanwhile, out-of-state carriers could skirt those regulations, she said.

Zvara also questioned whether plans available in another state, such as Idaho, would really be cheaper for Washington residents once variables such as the costs of procedures at local hospitals are taken into account.

“If you move that same policy to our state, you would be subject to the different pricing structure here,” Zvara said. “I’m not sure all those savings would carry over.”

Holly Mortlock, legislative liaison for the Office of the Insurance Commissioner, said letting insurers reintroduce the basic catastrophic injury plans would most likely cause them to have to readjust prices for other plans already on the state exchange.

Mortlock added that her office doesn’t approve of letting out-of-state insurers sell plans in Washington “without any oversight or enforcement.”

“This bill would compromise our ability to enforce the standards the Legislature has set for the health and well being of Washington residents,” Mortlock said.

The Olympian is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service