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Affordable Care Act

'Junk Insurance' No Bargain, Some Say

Many who have health insurance policies that don't meet the standards of the Affordable Care Act protested loudly when they learned their plans would be canceled Jan. 1. The protest forced the Obama administration to grant a one-year extension, but policyholders who take it may regret it, say some patients who learned the hard way.

Such policies are popular because they cost less than the ones that do meet the law's requirements if the applicant doesn't qualify for subsidies through Healthcare.gov. But there is a reason they cost less, says April Capil, who had to file bankruptcy after she was treated for breast cancer. 

McClatchy News Service tells the story in "Junk insurance comes back to haunt policyholders," published in Thursday's Miami Herald

Capil lives in Colorado, but her insurer, HealthMarkets, owns several companies that sell individual policies in Florida. They include MegaLife & Health Insurance Co. and Mid-West National Life Insurance Co. of Tennessee.  

Both have been in trouble in Florida repeatedly but the Office of Insurance Regulation has allowed them to file "corrective action plans" and continue selling. They still have thousands of Florida policyholders and sell millions of dollars' worth of products, as this report shows.

Another patient who is suing HealthMarkets, a restaurant owner from California, tells how he was about to go into surgery when the hospital's financial clerk came running down the hall, alarmed over the discovery that he had a HealthMarkets plan. When his wife offered a credit card, the surgery was allowed.

In other health insurance news, the Florida Health Insurance Advisory Board's Market Report shows a continuation of trends from past years: Enrollment down, costs up. A summary of the report is available at South Florida Business Journal.

The trend, at least in enrollment, is expected to reverse after Jan. 1, when Americans will be required to have health insurance (except for those who have very low incomes). Enrollment for 2014 continues at Healthcare.gov.