CHARLOTTE, N.C. » Mike Horrigan is a lifelong Democrat with heart problems who supports President Barack Obama’s health care law because he expects it will help many people obtain better insurance, including himself.
But under the new law, the Affordable Care Act, Horrigan’s coverage by a state high-risk insurance program was eliminated, then replaced by a more expensive plan. His wife’s individual plan was canceled for being substandard, then suddenly renewed — also at a higher price.
So while Horrigan, 59, believes the law will improve health care in the long run, its short-term effect has been chaotic and trying for him and his wife, Kay. "It’s more stressful than it needed to be," he said.
For a measure of the tumult that has accompanied the arrival of the federal health care overhaul, there may be no better place to look than in the politically mixed state of North Carolina, where both the anxiety and the promise of revamping the health insurance system has left hundreds of thousands of people struggling to sort out their options.
Many will end up with better coverage than they had, and may get help paying for it. Others will see their costs rise and are wondering if the change is worth it. And some, like the Horrigans, may find themselves falling into both camps.
The agitation has been building for months. This fall, insurers notified about 260,000 North Carolinians that their individual health plans no longer complied with the law’s more stringent requirements, and many learned that the plans they were being offered as replacements would cost hundreds of dollars more per month. Then, after Obama said Nov. 14 that insurers would be allowed to renew their plans for one year, Blue Cross and Blue Shield of North Carolina announced that 230,000 of its customers in the state could keep their own plans — but at prices that rose 16 to 24 percent.
Kathleen LeFleur, a broker who works with people who have individual plans at Employee Benefit Advisors, an insurance agency here, said many of the callers to her office had two things in common: confusion and anger. "They are confused before they call," she said. "After they call, they’re not confused anymore. They’re angry."
Adding to the confusion is the fact that many consumers have been unable to fully evaluate their options because the federal health care website, which serves residents of North Carolina and 33 other states, did not work very well until recently. Those who qualify for subsidies must sign up through the federal marketplace. Consumers have until Dec. 23 to sign up for coverage beginning in January.
"It has obviously been extremely frustrating for individual policyholders who have received cancellation notices at a time when there’s such a short window for them to decide what their coverage options will be," said Wayne Goodwin, North Carolina’s insurance commissioner, an elected Democrat.
Still, for some, the new law is working well. Rachel Bryant, a small-business owner who lives just outside Winston-Salem, felt unlucky when she received a notice from Blue Cross saying that her plan was being canceled and that the replacement would raise her monthly bill to $675 from $408.
But when Bryant, a single mother of two young children who earns about $30,000 through her legal services business, finally succeeded after many tries to log onto the online marketplace, HealthCare.gov, she learned she was eligible for subsidies that would bring down her premiums to just $150 a month.
"I’m extremely happy," said Bryant, 36. "I’m not going to go bankrupt because of medical bills. I’m looking forward to it, and I’ll put up with the frustration and the bother."
About half of those buying individual insurance in the existing market will be eligible for a subsidy, according to a national study by the Kaiser Family Foundation. That does not include an additional 1 million people who buy individual insurance now but, under the provisions of the health law, will be eligible for Medicaid beginning in 2014, according to the study.
For others, like the Horrigans, the transition is proving uncomfortable.
Kay Horrigan, 61, is a former psychiatric social worker; Mike Horrigan is a former corporate human resources expert who started a consulting business in Charlotte after atrial fibrillation required two heart surgeries. Because of his heart problem, he was denied insurance and found coverage through North Carolina’s high-risk insurance pool.
So they understood, Mike Horrigan said, why the Affordable Care Act was necessary. The new law was designed to fix flaws in the old market in which people with existing medical conditions, like Horrigan, could find themselves uninsurable and without limits on out-of-pocket costs — people for whom serious illness often meant financial ruin. Under the new law, such people cannot be turned away or be charged more by insurers, and subsidies are available to those whose incomes fall below a certain level.
"I was a poster child for why folks should have this opportunity," Horrigan said.
Then realities set in. Because of the law, the state eliminated the high-risk pool that provided his coverage, for which he paid about $400 a month. Then Kay Horrigan learned that her insurer, Blue Cross, was discontinuing her plan — which was deemed substandard under the new law — and replacing it with one that would cost $620 a month, up from $325, with a higher deductible as well.
Now, after Obama’s reversal, Blue Cross says it will extend her policy, though at a higher cost: She will get a one-year rate of $402, an increase of 23.6 percent, she said. After all the confusion, she will renew — and her husband has selected a midlevel plan through Blue Cross that will cost about $670 per month.
Calling the increases "unreasonable," Kay Horrigan acknowledged that they may be necessary to make the new system work.
"I appreciate the irony of complaining about my premiums being increased when it protects somebody like my husband," she said. "I reluctantly say we will probably be better off even though it hits us hard in the pocket."
Prices are rising for several reasons, including the law’s higher standards for coverage, and fees and taxes associated with it, said Barbara Morales Burke, vice president for health policy at Blue Cross in North Carolina. But she said the sticker shock some are feeling also has another cause: For years, insurers could charge people different prices based on factors like their health or gender. Now that the law prohibits such practices, some who benefited from the old system will be asked to pay more, while those who had been at a disadvantage will see some relief.
"This is a disruption to the marketplace," she said, and estimated that about one-third of Blue Cross’ individual insurance customers would see a significant increase in their rates.
David Naftolowitz, a psychiatrist in Durham, is among them. He was offered a replacement plan that would raise his monthly cost to $410 from $199. His deductible would rise to $5,500 from $5,000. He plans to extend his existing policies for a year, but said the extension was "like a teaser" that "takes the heat" off the president for the moment.
"You’re going to be hit a year from now," he said.
LeFleur, the broker, said that once her clients have been through the process and make their choices, they tend to calm down. "They can exert some control, and that makes them feel better," she said.
There is one silver lining in the tumult: Suzy K. Johnson, LeFleur’s boss, says she plans to expand. "I’m growing my team," she said. "This is an opportunity — they need us more than ever."
John Schwartz and Katie Thomas, New York Times