Health insurance corporations are under scrutiny on the way they explain coverage options to their policyholders
Court: No dump, no fees The U.S. Court of Appeals for the District of Columbia last week ordered the U.S. Department of Energy to stop collecting annual fees from nuclear power corporations to pay for disposal of nuclear waste because DOE has no foreseeable plans to store the waste—and has even been unable to calculate the fees with any certainty. The federal government in the 1950s and ’60s encouraged the construction of nuclear power plants and for years has collected fees from power companies for an eventual solution to waste storage. Congress in 1987 ended the scientific study of three candidate sites for a waste dump and targeted Nevada as the only site. Since then, the process has slowed to a crawl as Nevada, its congressional representatives, and environmental opponents have opposed the site. The federal targeting of Nevada left no back-up option for a single dump. Although last week’s court ruling characterized the petitioners as “a group of nuclear power plant operators,” the lawsuit was actually filed by the National Association of Regulatory Utility Commissioners, an indication of how cozy regulators have become with the industry they are supposed to scrutinize. The NARUC issued a statement: “Today’s decision from the court is great news for consumers of nuclear power. Nuclear utilities and their consumers have paid more than $30 billion since the early 1980s for the construction of a nuclear-waste repository. These consumers have upheld their end of the deal, but unfortunately all they have to show for their investment is a hole in the Nevada desert. Putting aside the political dispute about the proposed Yucca Mountain facility, nuclear-power ratepayers should not be charged for a program the federal government has closed down.” The ruling is an uncertain victory for the industry, which wants storage more than it wants relief from fees. The industry saves an estimated $750 million, but still has no dump. The court opinion claimed there is “no viable alternative” to the Nevada site, but critics say the existing on-site storage is a viable option, one that prevents hazardous transportation of the waste. Moreover, if there is no viable alternative to Yucca, it is in part because the federal government failed to follow through on a promised dump in the eastern United States, where most of the waste is generated. The U.S. is nearly alone in seeking deep underground storage of nuclear waste. No other nation has built such a dump and only one other nation—Finland—has even committed to try. “[W]e are presented with an opinion of the [DOE] secretary that sets forth an enormous range of possible costs,” the court ruling reads. “According to the secretary, the final balance of the fund to be used to pay the costs of disposal could be somewhere between a $2 trillion deficit and a $4.9 trillion surplus. This range is so large as to be absolutely useless as an analytical technique to be employed to determine—as the secretary is obligated to do—the adequacy of the annual fees paid by petitioners, which would appear to be its purpose. (This presentation reminds us of the lawyer’s song in the musical Chicago —‘Give them the old razzle dazzle.’) Thus, the secretary claims that the range is so great he cannot determine whether the fees are inadequate or excessive, which is essentially the same position we rejected only last year as in derogation of his responsibility under the statute. The Secretary may not comply with his statutory obligation by ’concluding’ that a conclusion is impossible.” At the same time last week, in response to a different court ruling, the Nuclear Regulatory Commission said it would revive evaluation of the Yucca site, though it is not clear how that will be paid for, because Congress has not funded it. Indeed, the NRC was having trouble figuring out how to make the relevant documents available to the public because of the lack of money. There is about $11 million remaining for Yucca evaluation, a pittance given the cost of the work. The NRC has asked also DOE for a supplementary environmental impact statement, but it is unclear how that study would be funded.
—Dennis Myers
8 | RN&R |
NOVEMBER 27, 2013
Misleading? Insurance corporations accused of steering policyholders away from ACA Suspicions that insurance companies are misleading consumers about their health insurance options under the by federal Affordable Care Act have Dennis Myers prompted a state probe by Nevada Insurance Commissioner Scott Kipper. Kipper acted after a request by U.S. Rep. Steven Horsford, who released copies of Anthem Blue Cross Blue Shield open enrollment letters that Horsford said fail to “accurately communicate to options consumers have when purchasing or renewing their plans.”
“It is our goal to communicate with members about all of their options.” Anthem Blue Cross Blue Shield The Nevada ACA exchange is at NevadaHealthLink.com
“The letters do not list the state exchange, Nevada Health Link, as an option for consumers to purchase health insurance,” Horsford wrote to Kipper in requesting action at the state level. “Only in a footnote do the [renewal] letters briefly mention that customers may qualify for federal subsidies through the exchange. … For example, a letter sent by Anthem Blue Cross Blue Shield of Nevada listed only three options for policyholders: renew a similarly designed plan, do nothing,
or shop for a different Anthem plan.” However, the letter does say—in the main text, not the footnote—that if the customer does choose to keep his or her current plan, “You will not be eligible for financial assistance from the government for your health coverage. Check the [footnote] notice below to see if you might qualify.” Whether the letters are sufficiently informative is a subjective judgment. The main body of the letters does not go into detail about ACA options. That information appears below the signature and consists of three paragraphs—a boxed note followed by two lengthy footnotes. The boxed note reads, “IMPORTANT: Financial assistance for your health coverage may be available. You could qualify if you have a modified adjusted gross income of $11,490 to $45,960 a year (or $23,550 to $94,200 for a family of four).” The boxed note and the footnotes are in the same size typeface as the body of the letter. A third letter released by Horsford does mention the Nevada health exchange prominently and in the main body of the letter, but Anthem said that letter was sent to policyholders only after they failed to respond to the first letter. Anthem said in a statement, “We are one of only two insurers selling products on the exchange throughout
the entire state of Nevada. ... It is our goal to communicate with members about all of their options so they can make an informed decision. We’ve partnered with local agents, online channels and retail locations to expand information and access.” Anthem insures about a quarter-million Nevadans and sells policies through the state exchange, NevadaHealthLink.com. Commissioner Kipper, who had already issued a joint warning with Attorney General Catherine Cortez Masto of the risk of scams when ACA was introduced, spoke with Horsford on Nov. 20, the same day Horsford sent his message and told him he would undertake an inquiry. (Kipper did not return calls seeking comment.) “Last night, Commissioner Kipper and I had a productive conversation,” Horsford said the next day. “He assured me that the Nevada Division of Insurance is launching an investigation into misleading letters sent by insurance companies to thousands of Nevadans. I trust Commissioner Kipper and his staff will thoroughly review the letters and offer a full report on the situation. Nevadans deserve clear, complete, and transparent options when it comes to their health care choices, not misleading information.”
Countrywide concern Horsford noted that another corporation, Humana, has been fined $65,430 by the Kentucky Department of Insurance for offering policyholders a chance to amend their health insurance in a letter characterized by regulators as “misleading.” In that case, too, the corporation sent letters to 6,543 policyholders that mentioned the state ACA exchange only in a footnote. Some of the matter included in the mailing had not been approved by state regulators. The fine imposed by the Kentucky insurance commissioner came to $10 per letter sent. In addition, Humana was required to send new letters retracting and apologizing for the first mailing and explaining the ACA and all other options in detail, in mailings approved by the state. Humana’s offense in regulators’ eyes was exacerbated because the corporation’s letter, sent in August, said policyholders had to choose between two options within 30 days,
