Wyo. official: Reversal roils insurance industry

CHEYENNE, Wyo. (AP) — The health insurance industry in Wyoming is in turmoil following President Barack Obama’s announcement that companies don’t have to stop offering some existing coverage after all, state Insurance Commissioner Tom Hirsig said Friday.

Obama on Thursday announced insurers can continue to sell coverage to existing customers. The announcement follows problems with the federal website intended to offer new health care coverage that meets requirements of the federal Affordable Care Act.

The federal government earlier had informed companies that they had to stop offering plans next year that failed to meet federal requirements.

Private insurers already have cancelled more than 500 policies in Wyoming and plan to cancel another 2,600 more, according to state figures.

Hirsig said companies hadn’t analyzed the cost of continuing existing coverage and are trying to determine the impact of Obama’s announcement.

“That’s going to be so tough for companies that have planned for three years not to renew those plans,” Hirsig said. “I’m not saying that they won’t, but it’s just not something they can determine overnight. They have to price those plans for the next year. There’s a lot of work that does into continuing one of those plans.”

Wyoming is among 36 states that opted to have the U.S. Department of Health and Human Services run its health insurance exchange, which essentially offers the public an Internet site to shop for approved insurance plans. Since opening early this month, the national site has been beset with problems, including not allowing people to register.

Under Wyoming Gov. Matt Mead, a Republican, the state had joined with Florida and others in an unsuccessful challenge to the constitutionality of the Affordable Care Act.

Only two companies have signed up to offer health insurance in Wyoming through the federal exchange: WINhealth and Blue Cross Blue Shield of Wyoming. Officials from both companies said this week that the federal website has been working better recently and allowing customers to register.

According to information released by the federal agency, health insurance customers Wyoming will face some of the highest premiums in the nation.

The national average cost for a “silver” plan for a family of four making $50,000 a year would be $774. In Wyoming, that rate would be $1,237, but tax credits for eligible insurance shoppers could bring the cost down.

Costs are higher in Wyoming, officials say, because it’s sparsely populated and there’s little competition among health care providers.

Hirsig said it will be entirely up to the eight other insurance companies that already had provided notice that they intended to end coverage in Wyoming because of the new requirements under the ACA whether they wanted to continue.

Attempts to reach officials at some of the companies that already have announced they’re pulling out of the state for comment were unsuccessful on Friday.

“It just happened yesterday, and they’re just trying to get their heads around it,” Hirsig said. “We’ve been talking to the companies and telling them, ‘let us know when you come to something.’ This is a total shock to them, this is changing their whole business model overnight.”

Hirsig said the National Association of Insurance Commissioners had a conference call immediately after Obama’s announcement.

“It’s just complete chaos,” Hirsig said. “There’s just hundreds of questions.”

Hirsig said he couldn’t address whether he believes Obama’s announcement shows a lack of understanding of how the insurance industry works.

“I think politics has been a big part of the Affordable Care Act, and I think it’s still a big part of it,” Hirsig said. “It’s kind of laying it back on the insurance companies’ doorstep, saying ‘you have the option to renew it, I’m not the one saying you can’t.’ So it kind of shifts some of that back to the insurance companies now. I think that’s kind of unjustifiable.”

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