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Forget Nov. 30; Crunch Time for Health Law Comes Jan. 1

By Rebecca Adams, CQ HealthBeat Associate Editor

November 27, 2013 -- Saturday marks the day the Obama administration has said will be in fairly good shape, although officials are downplaying expectations and contending while the website is much better, it will continue to be improved. Another deadline, however, is unavoidably real: the start of January.

That is when health coverage is supposed to begin for plans sold on the federal marketplace and the marketplaces operated by the states under the 2010 health law.

Many possible problems are coming into focus as Jan. 1 approaches, raising a question perhaps crucial to the fate of the health care law. Will the availability of new benefits soften harsh public perceptions of the law's rocky rollout, or will an onslaught of new difficulties make the launch seem much worse?

The arrival of the new year could make the enrollment problems in October look almost tame by comparison. For example, people who had coverage in 2013 may not have it in 2014. Some people who believe they enrolled in time for 2014 coverage may not be listed correctly in insurers' databases. That could mean problems getting claims paid by insurers next year.

Last-minute enrollees may not get notified that they are covered by the time benefits start. And many of the newly enrolled people, some of whom have never had insurance before, may be uncertain about what their new benefits provide, which doctors are covered or how much they have to pay out of their pockets.

Even supporters of the law (PL 111-148, PL 111-152) expect confusion as the benefits start.

"It's very likely there will be some confusion as to whether people are covered or not, who's in the network, whether their drugs are covered," said Tim Jost, a law school professor at Washington and Lee University who is an expert on the health care law. "And I'm sure we can count on opponents of the law calling every reporter and sending out negative anecdotes. It probably is going to take a little while for everything to settle down."

White House officials say that, which handles enrollment in 36 states, is operating much more smoothly than it was soon after the October launch. But even after recent improvements, the website is expected to only be able to handle 50,000 users at a time.

And the administration expects a surge of interest in December, because anyone who has not enrolled by Dec. 23 will not be covered in January.

The administration hopes that only about one in five people would have to apply through paper applications or by calling a hotline because they are unable to enroll online. It is not clear whether they are meeting that goal.

Some people who currently have coverage could find themselves without it on Jan. 1. That includes those who are getting notices that their policies are not being renewed because the benefits do not comply with the law's minimum benefits standard. President Barack Obama announced recently that insurers could choose to extend those policies for an additional year if state insurance commissioners allow it. But that reprieve does not help everyone.

In California, more than 900,000 people have gotten cancellation notices. State officials are not permitting extensions, except for one previously announced plan that covers about 200,000 people. It seems clear from recent enrollment statistics that hundreds of thousands of Californians who will lose coverage on Jan. 1 will not have enrolled in the marketplace by then.

"No doubt there will be some people who had coverage before who receive cancellation notices who will not have been able to get enrolled in new coverage, and so there are going to be some problems like that," said Families USA Executive Director Ron Pollack, a supporter of the law. "I don't know how large ultimately the gap will be."

Pollack acknowledged that for "anyone with significant health care problems, this is going to cause some significant difficulties for them, no away around it."

Another category of people who are losing coverage are those who currently are covered by the 35 state high-risk plans.

Fifteen of the 35 plans had been slated to cancel coverage by Jan. 1 because state officials assumed people would transfer to the new marketplaces, where insurers will be unable to deny coverage for people with pre-existing conditions, according to the National Association of State Comprehensive Health Insurance Plans. Another two states, Colorado and Florida, planned to end coverage in April and June 2014, respectively.

Those enrolled are chronically ill patients who do not want to stop getting medical care for their conditions, such as cancer or diabetes.

One state, Indiana, has announced it would extend coverage, but it is not clear how many more will follow that lead.

Administration officials did try to give consumers more time to enroll by extending the original deadline for January coverage from Dec. 15 to Dec. 23. But that time frame put more pressure on insurance companies who have to process the information.

Some of the biggest concerns involve the information flow between the website and insurers. Centers for Medicare and Medicaid Services (CMS) IT advisor Henry Chao, who has been one of the leaders of the project, said earlier this month that 30 to 40 percent of the website still had not yet been built.

Those functions include the payment and processing tasks that the public does not see, such as sending subsidy payments to insurers.
Bob Laszewski, a consultant for insurers, said recently that some progress has been made, "but not enough." Insurance companies are still seeing errors in enrollment information sent from people who have enrolled through

Last week, CMS Communications Director Julie Bataille said that "two-thirds of the high-priority" fixes for problems with sending information to insurers had been completed. Federal officials have not said when all of them would be finished.

"Unless major progress is made in the next week, people in the insurance industry are very worried about a great many people signing up in December creating a major customer service challenge," Laszewski said. "There would be a challenge anyway just from volume. Add the current error rate to it and this would be a real mess."

Leading supporters of the law already are trying to shift the focus from Jan. 1 to yet another deadline—March 31, when open enrollment ends. People who have not signed up by then will not have another chance to enroll in the marketplaces until November, unless they have a personal change, such as a loss in health care coverage or a move to another state.

"If the enrollment is successful and many millions of people do get enrolled by the end of March, the political problems will be relatively small and potential benefits could be very high," Pollack said.

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