Government won't send notice when members switch insurance companies

Despite promises of a smoother enrollment process through the federal health insurance marketplace, some health insurance execs say the way the government plans to notify insurers about enrollment changes--or not notify them, as the case may be--could cause confusion.

Back in June, the U.S. Department of Health and Human Services proposed a new rule, set to take effect in 2015, that would automatically renew customers' plans unless they specifically opt out.

But what happens if a consumer reviews their options and decides to switch to a plan with another insurance company? The government does not plan to notify the original insurance company in those cases.

"There is going to be a lot of confusion," Rachel Klein, director of the enrollment program at consumer group Families USA, told The New York Times.

Aside from the potential paperwork and legal headache for payers, the policy also raises the possibility the customer will be charged twice, especially if he or she has premiums deducted from a bank account automatically, notes The Times

Aaron Albright, a spokesman at the federal Centers for Medicare & Medicaid Services, told the Times that insurers should assume coverage should be continued unless the government says otherwise. The marketplace will send enrollment files for renewed coverage to insurers in late December.

But payers say they are hesitant to cut off any member's coverage unless clearly told to do so.

Meanwhile, insurers cannot send out renewal notices to customers until contracts are signed with the government in November. Yet some state laws require insurers to inform consumers two to three months before Jan. 1, when renewals take effect.

Federal officials are discussing this problem with state insurance regulators and are expected to issue guidance on it.

The new CEO for Healthcare.gov, Kevin Counihan, swears the signup process, which begins Nov. 15, won't suffer the technical nightmare that plagued the process last year. HHS officials will be testing the site for almost six weeks before this year's open enrollment period.

And the new application has fewer pages, questions and screens to navigate, making the overall process simpler.

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