California faces a new problem with health care reform

California health insurance

New health insurance issue erupts in California

A new health insurance problem has emerged in California and several hundred consumers have already been affected by it. Late last year, many people throughout the state received notifications from their insurance provider informing them that their coverage would be canceled due to the health care reform law. Many of those with cancelled policies went to the state’s insurance exchange in order to find new coverage. In most cases, consumers were able to find less expensive coverage with better benefits, but now many of these people are finding themselves paying for two insurance policies rather than one.

Federal provisions put substandard insurance policies into a proverbial grey area

California health care reformAccording to the provisions of the health care reform law, insurers must cancel policies that do not adhere to federal regulations. This meant that consumers would have to find new policies from either their insurance provider or from a state’s insurance exchange. This caused an outcry from consumers and businesses alike, leading President Barack Obama to take action on the issue. The President announced that insurance companies could continue to honor substandard insurance policies, but that would be an issue for state officials and insurers to determine. Many insurers opted to keep substandard policies cancelled.

Consumers are finding themselves enrolled in new insurance plans without their permission

For many people in California, this meant that their health insurance coverage was no longer valid. Insurers, such as Anthem Blue Cross, become somewhat cavalier on the issue. Many people have reported that their insurance providers have enrolled them into new insurance plans without their permission. The California Department of Insurance is currently investigating the issue to determine what legal ramifications are associated with insurance companies enrolling consumers into new plans without their permission.

Insurers encounter problems with health care reform

The major changes being made to the health care landscape through federal law had been expected to cause some problems for businesses and consumers. Insurers have been working to comply with new federal regulations and this sometimes means that mistakes are made. Those being affected by this new issue in California, however, suggest that insurers are taking advantage of the confusion caused by cancelled insurance policies and federal initiatives that have extended the availability of policies that had been cancelled last year.

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