More than 28,000 Tennesseans will lose access to state-sponsored insurance programs that are either winding down or curtailing enrollment because of the Affordable Care Act.
The programs include CoverKids, CoverTN, AccessTN and CoverRX.
People affected by the changes can shop for replacement policies beginning Tuesday when the Health Insurance Marketplace, the exchange that offers subsidies toward lowering premium costs, goes active. But all may not qualify for the subsidies, which are based on income and whether coverage is offered by an employer.
Letters are going out this week to explain the changes to people covered by AccessTN, a program for people who have pre-existing medical conditions, and by CoverRX, a prescription benefits program. The 16,000 people enrolled in CoverTN, a limited benefits plan, have already been notified it will end Dec. 31. Many families also have received notice they will no longer be able to buy into CoverKids.
"The Cover Tennessee programs were designed to fill gaps in coverage for Tennesseans who had difficulties accessing health insurance," said Darin Gordon, deputy commissioner of Health Care Finance and Administration. "Over the past six years, those programs have provided coverage to thousands of Tennesseans."
Former Gov. Phil Bredesen established the programs after he overhauled TennCare and cut more than 350,000 people from its rolls to avert a state budget crisis. The programs stopped a portion of those people from falling through the coverage gaps; however, some of them offered meager or modest benefits because of monetary caps.
"Due to many new insurance reforms, one of which is the opening of the Health Insurance Marketplace to consumers on Oct. 1, some of the Cover Tennessee programs are changing, because the need for this type of coverage will no longer be necessary," Gordon said. "Also, some programs, such as Cover Tennessee, will no longer meet the new requirements of coverage."
Some working parents could be left in the lurch because of the "family glitch" — a rule that prevents a parent from buying subsidized insurance for a child on the exchange if the parent is covered by an employer's plan. That's a scenario that could affect thousands of Tennessee families, not just the parents of the 650 children cut from CoverKids because their parents make too much money.
The state will no longer allow parents making more than 250 percent of the federal poverty level ($58,875 for a family of four) to buy into Tennessee's version of the federally sponsored Children's Health Insurance Program. The program is free for families with lower incomes. The state allowed other families to buy into it, paying monthly premiums that ranged from $294 to $375 per child based upon income.
Neither CoverTN nor AccessTN meets the requirements of the federal health law because both plans set monetary caps. While CoverTN ends Dec. 31, AccessTN has received a federal reprieve because of a rule that allows high-risk insurance pools an additional year.
However, the state is limiting enrollment in AccessTN. Of the 2,600 people currently enrolled, about 1,900 will no longer be eligible. Only those with incomes below the federal poverty level and who receive premium assistance will be able to stay on the program.
The state also is closing CoverRX to people who make more than the federal poverty level, which means 10,000 of the 54,000 people enrolled in that program will lose coverage.