UnitedHealthcare said Monday that it will continue to offer certain popular
provisions called for by the federal health care law no matter how the U.S.
Supreme Court rules, a sign that some overhaul efforts already have gained
As the nation's largest health insurance company, UnitedHealthcare can wield tremendous power on Capitol Hill -- as well as in the marketplace. Following its announcement, several other national insurers followed suit.
Minnetonka-based UnitedHealthcare said it will allow young adults to stay on their parents' plan until they turn 26 and continue to provide preventive care, such as immunizations and cancer screenings, without co-payments.
The insurer also said it won't cancel policies retroactively, except in cases of fraud, and won't impose lifetime limits on coverage. Such limits can cause hardship for those with expensive chronic illnesses and rare diseases.
"It's a pretty good PR move," said David Heupel, senior health care analyst with Thrivent Financial in Minneapolis. "But it's also smart business, regardless of health care reform. It's easily managed within their book of business."
About 26 million of the 35.6 million people on its plans would be affected, according to Kaiser Health.
The announcement comes as the Supreme Court is expected to rule by the end of the month on whether the law is constitutional.
A key issue is the requirement that nearly all Americans must buy coverage or pay a penalty. Insurers have argued that an individual mandate is necessary to pay for expanded coverage because the costs can be spread among healthy as well as sick people.
Humana and Aetna were among national insurers to follow United's lead on Monday, saying they would match some or all of United's benefits. Blue Cross and Blue Shield and WellPoint issued statements saying they would wait for the ruling.
Aetna spokesman Matt Wiggin said in a statement that a number of provisions in the health reform law -- including expanding coverage for young adults and covering some preventive care -- have been "woven into the fabric of our health care system."
While Aetna will maintain such coverage, Wiggin said, the law "has propelled interest in exploring new ways to deliver care" and that the insurer believes that collaborating with providers is "key to building a more effective health care system."
Bob Laszewski, a consultant and former insurance executive, noted that the changes are relatively inexpensive and already are factored into the coverage price.
"It would probably be more trouble to roll these things back than go ahead with them," he said.
UnitedHealth Group declined to make an executive available Monday. In a statement, CEO Stephen Hemsley said the decision "makes sense for the people we serve and it is important to ensure they know these provisions will continue."
Consumers already have seen other benefits of the law, passed in 2010, including expanded drug coverage benefits for seniors and rebates from insurance companies that didn't spend at least 80 percent of premiums on patient care.
Insurers also no longer can deny coverage to children up to 19 even if they're already sick. Notably, UnitedHealth and the others didn't extend that provision.
United said it "recognizes the value" of covering children with pre-existing conditions but said one company can't act alone.
Because treating childhood illnesses can cost hundreds of thousands of dollars and more, especially if they last for decades, United needs some buy-in from other insurers so that it isn't the only company covering such cases, Heupel said.
"That's where they threw down the gauntlet," Heupel said. "Hopefully it'll spark some debate and conversations. I can't say in history there's been a lot of that going on where the big guys got together and hashed out underwriting strategy, but stranger things have happened."
Twenty percent of U.S. consumers are covered by one of United's plans, which are sold to individuals, small groups and businesses. The company also has the nation's highest enrollment in Medicare and Medicaid, government programs for seniors and low-income people.
The company did not say how much it will cost to extend the provisions, but it's unlikely to affect earnings measurably. Young people tend to be healthy, and spotting treatable illnesses early typically saves money. United also will keep a simple channel for appeals that is "clear and timely" and allow patients to review their files and present evidence as part of the appeals process.
Still, the biggest changes don't take effect until 2014, including establishment of online health insurance exchanges, expansion of the state-federal Medicaid program for low-income people, and tax credits to help people buy insurance.
Although many managed-care companies feared additional regulation on how premium dollars get spent, the industry seems to have adjusted. UnitedHealth Group hit $102 billion in revenue last year, with annual profits rising b 5 percent.
The Associated Press contributed to this report.
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