BlueCross BlueShield North Carolina drops grandfathered plans

Blue Cross Blue Shield North Carolina will stop offering its  grandfathered health plans as an alternative to Affordable Care Act coverage as of Jan. 1, 2018, the company said.

Blue Cross North Carolina has been offering the grandfathered plans since the ACA was enacted in 2010 because of a provision of the law  allowed consumers to keep their current coverage.

About 50,000 customers are affected by Blue Cross North Carolina's decision. This compares to 2010, when over 330,000 consumers were in these plans.

Over the past seven years, customers have dropped the coverage. And those that remain have gotten older and sicker, without new customers to balance the risk pool, according to the insurer.

The cost to continue to offer the coverage has become disproportionate to the number of consumers enrolled.

[Also: Patrick Conway is leaving CMS to head Blue Cross Blue Shield North Carolina]

"We'd need to raise rates for these customers a significant amount to keep offering these plans in 2018," the insurer said. "When we considered all of these factors, we determined that Dec. 31, 2017, is the right date to discontinue our grandfathered plans."

This means customers who currently have coverage through a grandfathered plan will need to transition to the ACA market. Younger adults without the benefit of ACA subsidies can expect more covered healthcare services, but at a significantly higher price.

They can also expect fewer in-network providers. That's because in some areas of North Carolina, the insurer no longer offers a broad network product to ACA customers, the company said.

"We know this will be tough news for our customers who love their grandfathered plans," Blue Cross North Carolina said.

As in all ACA plans, the insurer must cover those with preexisting conditions, and is limited in its ability to charge older or sicker customers more.

"Many customers transitioning off grandfathered plans will pay more for coverage in 2018. Many will pay quite a bit more," Blue Cross North Carolina said. "However, we believe that a portion of our affected customers will qualify for subsidies to offset the cost increase."

Comparing current year premiums for grandfathered plans to premiums for an ACA plan next year, younger adults will generally pay more for ACA coverage, while older men and young women will pay less, the insurer said.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com