PIERRE, South Dakota — South Dakota insurance regulators said Thursday they need more time to study President Barack Obama's announcement that insurance companies will be allowed to keep offering their customers plans that would otherwise be canceled under the federal health care law.
The president said the administrative changes would give insurance companies the option to extend for one more year policies that would otherwise be canceled because they don't meet the standards set in the Affordable Care Act. State officials would have to approve those changes.
Obama's policy change could affect at least a few thousand South Dakota residents who are due to lose their existing policies.
State Insurance Director Merle Scheiber said his agency is sorting through how the president's announcement would affect insurance companies and their customers.
"The president's new direction requires a detailed analysis in order to identify the best options for consumers and businesses. We will do what is best for South Dakotans and are demanding more details regarding this policy change," Scheiber said in a written statement.
Officials with Avera Health Plans and Sanford Health Plans said they intend to extend policies that would otherwise be canceled, if the state allows them to do so. But they said the state would have to make quick decisions about the plans and rates.
"The timeline we have to get this done is very short. It's not as simple as saying we're going to continue the plans we currently have," said Ruth Krystopolski of Sanford Health Plan. "Our intention is to figure out how to best serve the customers we have."
Sanford was in the process of canceling about 2,000 health policies in South Dakota, while Avera was moving 800 to other policies because their old plans didn't meet the new requirements.
Heidi Engelhart of Aberdeen said she would like to keep the plan that covers her family, which includes her husband and two children, if that's possible. She said the family's current insurance company has given notice it will no longer will sell health insurance in South Dakota.
"I would want my policy back, but will they offer it back?" Engelhart said.
Engelhart said her family paid $1,445 a month under the old policy with a $5,600 deductible. Along with the notice that policy would be canceled, the family got a guarantee that another company would cover them, but at $2,468 a month with a $10,000 deductible, she said. The new policy would have maternity coverage, which the family doesn't need, she said.
Engelhart said the president's policy change is a nice gesture, but the problem of canceled policies should have been handled earlier.
"Why did they have to let it go this far?" Engelhart said.
Engelhart said she eventually will probably check out the federally run online exchange that offers policies that are compliant with the Affordable Care Act, but she hasn't bothered to go to that Internet site yet because it's been beset with problems that have prevented people from signing up for insurance.
Engelhart also said she is reluctant to trust the exchange policies that comply with government requirements.
"Most everything the government gets their hands on doesn't turn out well," said Engelhart, a Republican who contacted Rep. Kristi Noem, R-S.D., to discuss the issue.
Avera, Sanford and DAKOTACARE, which is associated with the South Dakota State Medical Association, are approved to offer plans on the exchange in South Dakota.
Avera had enrolled 106 people through the exchange by Thursday, while Sanford had signed up 28.
Deb Muller of Avera Health Plans said the online exchange is working better now, with most people reporting they can select an insurance plan within an hour or so. Avera talks to everyone who selects one of its health plans through the exchange, and many are pleased because the new policies will cut their costs, she said.
One person who was paying $600 a month for insurance will pay only $77 a month with an exchange policy because of the tax credits available to people of modest incomes, Muller said.
"That's some of the more fun calls we get to take on a daily basis," Muller said.