November 21, 2013

Maine small businesses wrestling with health law

Some have their policies canceled or rush to renew early amid the confusion, but lower costs will come, a federal official says.

By Kevin Miller
Staff Writer

WASHINGTON — Small businesses across Maine are renewing their health insurance policies months early rather than buying new plans that comply with the Affordable Care Act, reflecting confusion and uncertainty about the effects of the federal law.

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Bob Neveu, president of the Portland software company Certify LLC, says dealing with the new health care law has been frustrating and confusing.

Gabe Souza/Staff Photographer

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Anthem Blue Cross Blue Shield, Maine’s largest insurer, says it is getting a “very sizable percentage” of renewals that will take effect before new coverage mandates begin Jan. 1. Insurance brokers also report strong interest among businesses that want to renew before year’s end.

Some businesses are renewing early to delay what will likely be higher premiums under the health care law. Others simply want more time to consider their options.

“We find people are still on the steep end of the learning curve as far as the Affordable Care Act and what their choices are,” said David Clough, Maine director of the National Federation of Independent Businesses.

For weeks, headlines have blared about the millions of Americans who have received cancellation notices from their insurers because their policies won’t meet minimum coverage standards under the Affordable Care Act.

Robert Neveu is in the less publicized but sizable group of business owners who got cancellation notices for insurance bought for employees on the “small group market” and are now struggling to navigate the new system.

Neveu, who runs the Portland-based software company Certify LLC, summed up his experience in the past 30 days with two words: frustration and confusion.

He said he was shocked initially to learn that his employees’ insurance plan – for which Certify pays 100 percent of the premiums – will not comply with the new law. He also fears that changes to the rate-setting system could drive up costs and lead to hiring discrimination, especially against older workers.

Neveu opted for an early renewal of his company’s current policy and was pleased to get a discounted rate, only to face the possibility that the insurer’s offer could be withdrawn after President Obama announced last week that insurers can honor non-compliant policies for another year. Neveu has since learned that his company will be allowed to renew at the lower rate, and hopes that will end the roller-coaster ride for him and his 30 employees.

“I don’t have a political ax to grind,” Neveu said, noting that he voted twice for Obama, the law’s chief architect. “But the impacts on my business are mind-boggling.”

Anthem Blue Cross Blue Shield has long offered early renewal, and has been talking with clients about the option since the spring. The rate of early renewals has increased significantly in recent months, with a “very sizable percentage” of early renewals for contracts that were to expire in the first quarter of next year, said Eric Jermyn, the company’s small-group sales director.

“The whole early renewal discussion is really about giving employers time to meaningfully consider their options and what is the best thing for them, for their employees and for their families,” Jermyn said.

A political storm in Washington could lead to more changes to the Affordable Care Act, and that uncertainty isn’t helping businesses.

Tony Payne, business development director for Clark Insurance in Portland, said his agency has fielded requests from clients that want to renew insurance plans before Jan. 1. Other businesses are debating whether to continue offering insurance to employees at all, he said.

“I think confusion continues to be the order of the day,” Payne said.

The Affordable Care Act set minimum standards for insurance plans. Those new standards prompted cancellation or change notices to millions of policy holders nationwide who bought their insurance as individuals or through the small group market, which typically is used by businesses with fewer than 50 employees.

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