ACA Update: Are Insurance Companies Ill-Equipped for ‘Obamacare’ Roll-Out?

Since October 2013, Americans have been enrolling for health insurance under the Affordable Care Act (ACA) on Healthcare.gov or through insurance agents and brokers. With only a few weeks to go before the March 31, 2014 ACA enrollment deadline, the US Department of Health and Human Services has reported that more than 5 million Americans have enrolled for health insurance through the state-based exchanges.

Enrollment in the ACA and in expanded Medicaid has been patchy because states were given too much leeway regarding what care would be available, how people should enroll, and how much money and effort would be invested into educating residents about enrollment. Some states (like California) have well-developed online insurance exchanges of their own, while other states (like Arizona) allowed the federal government to create their ACA exchange websites and did little to educate residents about health insurance enrollment.

During the final weeks, non-profit groups and volunteers in Arizona have been scrambling to enroll people, while the Arizona Republican Party is scrambling to spread misinformation to discourage enrollment– with multiple speaking engagements and mass distribution of an editorial entitled Obamacare: To Enroll Or Not To Enroll? That Is The Question by local doctor, Elizabeth Lee Vliet. And on the national level millions is being spent to dissuade Americans from enrolling, while Republicans in the House offer bait-and-switch alternativesto the ACA which would cost more and cover fewer people.

As both sides of the political spectrum work hard to sway the public, my question is: Are the insurance companies really up to the task of providing care for so many new enrollees? 

Although the mainstream media takes delight in reporting that fewer people than projected have enrolled through HealthCare.gov than projected, no one is reporting the number of new insurance enrollees who shopped the HealthCare.gov website but signed up for insurance through an agent or broker (as my employer did). Consequently, the true statement is that health insurance companies have recruited at least 5 million new customers since October, how can that be bad for business? Just look at the 27.6% increase in HealthNet’s stock price between November 8, 2013 and March 10, 2014 (graphic at the top).  Big corporations are making big money on the ACA. Why are the Republicans fighting against it and campaigning against Obamacare as a wedge issue?

Poor Implementation of ACA by Insurance Companies

Were insurance companies betting that the Republicans could really repeal and replace Obamacare– if they threw enough money and media at it?

Nearly three months after enrollment, we are underwhelmed [being polite here] with the service that our employee group has gotten from HealthNet, our chosen insurance provider. What has transpired since my boss paid our first premium to HealthNet in December is an untold story. Today’s post is the rest of the story,

The slow service and multiple missteps by HealthNet have led me to believe that insurance companies were betting the Republicans could stop implementation of the ACA. Obviously, the GOP tried very hard to end insurance reform, with more than  50 repeal votes and many financial showdowns, like last fall’s government shutdown.

Individuals and employers who paid premiums on or before December 23, 2013 were supposed to have insurance coverage as of January 1, 2014. Since we had not received insurance cards by January 8, I contacted our insurance broker, who said:

Healthnet had an overwhelming amount of new groups for 1/1/2014 and they are running behind in installing new groups.They have recruited people from other departments to help in the process and are working diligently to enroll groups. Please pass this information on to the employees and please be in touch should you need to see a doctor in the next week or so. ID cards will be mailed ASAP once the group is enrolled.

Eight days into the plan year, we didn’t have the coverage we had paid for. Maybe HealthNet should have bulked up their staff to accommodate the new groups? They knew the deadlines and the expectations for months. Early in January, we also has not received our ACA authorization– which confirmed that my employer is in Arizona and does have employees who are eligible for insurance through the ACA exchanges. We received the authorization from the ACA on January 11 (long before we received insurance cards or a group number from HealthNet.)

Two weeks into the plan year, our broker said that HealthNet was beginning to catch-up, and she sent me a rate memo to sign for the medical benefits but not the vision and dental add-ons that everyone had purchased.

Three weeks after the premium was paid, we still didn’t have insurance cards or a group number. We were told that we could still go to the doctor and just tell them we had coverage [like that’s gonna work], or we could pay for services and get a reimbursement [cuz getting money out of insurance companies is really easy… not].

Being a skeptical lot, none of us went to the doctor during January. As a group, we had just paid ~$2500 for one month of service we didn’t receive. At this point I submitted a constituent letter on Congressman Ron Barber’s website complaining about insurance company implementation of health insurance and suggesting he determine how many other Arizonans have paid premiums and not received services from HealthNet or other insurance companies. (Weeks later, I received a generic letter outlining Barber’s mostly Republican-leaning votes on the ACA; there was no indication that anyone had actually read– much less acted upon– my letter complaining about insurance company implementation of the ACA in Arizona.)

Paying for services we didn’t receive would really piss me off if HealthNet had ever sent us another bill. That’s right, we have not been billed for February or March. Ironically, Aetna, who we dumped and have not paid since early December, sent us all insurance cards and promos and continues to invoice my employer, despite the official cancellation letter we mailed to them. Obviously, neither HealthNet nor Aetna are keeping up with enrollments or cancellations. (The Republican bait-and-switch alternative would give health insurance companies more money and more power because it would allow plans to cross state lines. Why should be give them more responsibility when they obviously can’t handle the flood of new enrollees, thanks to Obamacare and healthcare reform?)

One month after the initial payment, we finally got an email from the broker with our group number but were told that it could take 10-12 days before the number would be active in HealthNet’s system. In other words, if any of us had given the group number to a doctor at that point, the system may say the group didn’t exist.  To me, this nonsense smacks of incompetence or extreme understaffing or both. Again, insurance companies knew the deadlines, the expectations, and the potential impact in terms of new enrollees.

Still no cards but we had a group number, which helped employees feel confident enough tothink about going to the doctor in the near future. That’s right. HealthNet’s snail speed caused all of us to delay care.

And then… excuse my French, but the real pisser came on January 28 when I found out that we really didn’t have dental or vision insurance– even though the employees had paid $20/person/plan/month for it. We were quoted the wrong price for the add-ons to the medical insurance plan. Great. The vision add-on ended up being much cheaper than the quoted price, but the dental plan was a HORRIBLE deal (~$50/person/month with a deductible, co-insurance, and a $1500 cap per year). Yuck.

Two months after enrollment, employees finally received these ultra-classy paper insurance “cards” on February 20. It’s a really good thing that none of us had a car accident or medical emergency while we were waiting for HealthNet to get its act together. A trip to the Target pharmacy with my new HealthNet card was an eye-opener at how screwed up the system is. My husband has two common prescriptions and has been enrolled in Target’s discount pharmacy program for a year. When I picked up his last prescription, I gave the pharmacy the HealthNet card and asked them what the cost would be with the health insurance. The HealthNet price was $20 for 30 pills. The Target discount price was $21 for 90 pills– one third the cost of the pills under the health insurance plan that I am paying ~$500 a month for!

Three months after enrollment, we still don’t have the vision and dental plans worked out, even though employees have been paying these premiums through payroll deduction. HealthNets’ incompetence will cause my employer to write checks to all employees to reimburse them for premiums paid. The latest wrinkle is that HealthNet said that our employees really are eligible for the cheaper vision plan because that’s only for new groups that sign up by January 1, 2014. Hello! We paid our premium on December 23, 2013, and all of the employees clearly checked the boxes for vision and dental coverage on the enrollment forms. How is that not enrollment by January 1?

Widespread Complaints by New HealthNet Enrollees

How many other Arizonans paid the first HealthNet premium and got no services? 100s? 1000s? A quick Internet search revealed that we are not the only consumers upset with HealthNet’s disorganization. Here are just a handful of scathing reviews of HealthNet service from the Consumer Affairs website. Almost 90% of the complaints on this website give HealthNet a one star rating. Note the recurring themes of poor customer service– waiting for hours on hold, misquotes on premiums, missing bills, switching doctors. How is waiting THREE hours on hold an acceptable level of service? HIRE some people; you obviously have the customers and the money. [Emphasis added.]

Irene from Green Valley, March 5, 2014
These are not ‘once in a while’ things. They are constant. Reaching claims department is an impossibility! I have been cut-off after holding for over 2 hours several times. I have NEVER YET been able to get through to the claims department to even ASK why they are denying claims. In the documents they tell me I only have to pay a $50 copay for an Urgent Care. So far the Urgent Care has charged me $70, and they are now asking for another $50. They say it is because HealthNet is not paying the claim. But of course, I can’t get through to HealthNet claims department to find out why. I have been on hold with customer service literally for hours and hours, but when you do finally get through, they can’t help you with anything – all they can do is transfer you to another department which is ALWAYS the wrong one!!!

Gerogina of California, March 10, 2014
I then contact Health Net on February 3rd to find out why I had not received a bill yet and they state that the bills were sent late and to just make the payment whenever I received the bill. I received the bill on Feb 5th with the wrong premium. I contact their office to find out why it was showing the wrong amount. I’m told that they never received the information from Covered CA and that they cannot contact them over the phone, nor could they take any paperwork from me that showed the correct premium. It had to come directly from Covered CA. Mind you I sat on hold for over 3 hours just to get someone on the phone.

I contact Covered CA and sit on hold for 3 hours and 22 minutes before someone answers and they state that the information is correct in their system and that it was already sent over to Health Net several times and what more did I expect him to do. I told him his job and to contact them by phone to get this handled… He refused and told me to just fax them my Summary page. I contacted Health Net again and sat on hold again for an hour and 56 minutes. The person tells me they cannot accept any faxes from me nor can they log into my Covered CA account to see my information as it has to come directly from Covered CA. They file a report with their ACA department and said I’d hear back from them.

As of today… 33 days later, I still have not heard back from them. I had to file a grievance with the California Department of Managed Health Care in order for Health Net to get in contact with Covered CA to fix my premium issue and I was finally able to make my February payment on March 6th. They still have not address my mailing address issue and now they’re saying Covered CA shows me as terminated for March and active for April. This doesn’t even make sense. Why would someone terminate coverage for one month? They wouldn’t. By the way, I never received notice of this.

Jaimie of California, March 14, 2014
The following letter is a re-telling of the ordeal that my wife has been through over the last several months as she has attempted to be seen by a doctor who is able to help her with the severe pain she has been experiencing in her right forearm.

In January we were rushed to sign up for a new health care plan because Health Net determined that we could not keep the PPO we had with them up to that point. Although it can be easy to blame the ACA for this need to change plans, it is clear to me that it was Health Net’s decision to not modify our plan to abide by the new laws even though it was within their means to do so. With no advice or ability to speak to an agent who could provide us with suggestions with regard to what plan was best for us (due to an overwhelming of the phone and online systems at that time), we opted into a Health Net HMO, the IFP Community care Silver plan. The cost of this plan was more than double what we were paying before.

Upon receiving the details of our selected plan, we noticed that the PCP that we had been assigned was very far away from our home. Subsequently we contacted Health Net directly to change our PCP to one that is closer to our home. On the first call (where we were waiting on hold for approximately 140 minutes) we were told that we did not have authorization to change the primary care doctor for our 3 children who are all under 6 years old. When we asked to speak to a supervisor to resolve this clearly inaccurate information we were told there was not one available and when we persisted we were disconnected from the call.

We called back again later on that same day and were successfully able to change our PCP to Dr. **. My wife was experiencing terrible pain in her right forearm so we contacted the PCP 4 full business days after we changed to this PCP and were told that we could not make an appointment because we did not yet have our new insurance cards. When I asked George the receptionist if he could contact the insurance company directly to confirm that we had switched to this new PCP, he said that he did not have the time and he hung up the phone.

Pete from Flagstaff, March 13, 2014
I purchased a $300 per month PPO plan through Health Net, which began at the beginning of March. Problems started immediately, as soon as I tried to update my insurance with my primary care Doc, (whom I have been well established with for years). I was very surprised when I was told that my primary does not accept Health Net.

I was simply told to get a list of doctors in their network, and see if they will accept new patients. Unfortunately there are no doctors close to my area that accept Health Net. I had also been scheduled to see a cardiologist, (who did accept Health Net), but the catch was they needed a referral from my primary, so I had to cancel. What is the point of having a PPO plan, I am canceling ASAP!!!

My conclusion? The health insurance is organized crime. The only problem with the ACA is its reliance on capitalism and the private health insurance industry for implementation. When will our government realize that Medicare for All is the best plan?