To: All Insurers Licensed to Write Health Insurance in Nebraska
On November 14, 2013, President Barack Obama announced a transitional policy that certain federal statutory provisions of the Affordable Care Act related to insurance market reforms will not be enforced by his administration in 2014 to allow for the renewal of noncompliant insurance policies in 2014. Despite the lack of enforcement by the federal government, it is the opinion of the Nebraska Department of Insurance that individual and small group health insurance policies issued or renewed on or after January 1, 2014, must comply with the provisions outlined in the Affordable Care Act. Therefore, the President’s announcement has no legal effect for the purposes of insurance regulation in Nebraska.
However, health insurance companies do have the option in Nebraska to renew policies before December 31, 2013. Nebraska insurance law already provides companies the option to engage in an early policy renewal process for policies. Earlier in the year, some companies elected to allow customers to utilize the early policy renewal and other companies declined and canceled some policies effective on December 31, 2013. However, as long as the cancellation deadline on notices has not yet taken effect, Nebraska law still allows companies to engage in the early renewal process. As a result, those policies renewed on or before December 31, 2013, would allow a company’s customers to keep their existing policies for one more year.
If a company has previously provided cancellation notice to customers and now decides to engage in an early renewal process, the company should notify the Department immediately and must file no later than 5 p.m. (CST) on December 2, 2013, all necessary forms and rates for expedited review by the Department. The Department will not review filings made after the deadline.
Companies that are requesting rate adjustments should be aware that the Department fully expects any such filing, if it includes a rate adjustment, to comply with the Affordable Care Act’s provisions regarding reasonable rate increases. Additionally, the Department of Insurance fully expects any company providing such a renewal option to provide that option to all impacted policyholders.
Consumers should be aware that while the terms and conditions of the policies that are renewed early will have the same plan benefits, the insurance company may increase a consumer’s premiums. It is important to note that a decision to increase rates is the decision of the insurance company. While this must be approved by the Department of Insurance, the insurance company is responsible for determining their rates.
The decision to file for a rate increase, however, is a company by company decision. It may be in a consumer’s best interest to talk to a licensed insurance agent or broker before making a decision to renew an existing policy or shop for other insurance options.
Questions regarding the filing of plans may be directed to Stephen King, Administrator of the Life and Health Division at 402-471-2201. Questions regarding other issues regarding this release may be directed to Martin Swanson, Health Policy Counsel, also at 402-471-2201. If consumers have questions regarding the status of their current policies, they should contact their insurance carrier.
