Some insurers stop new coverage for kids

July 24, 2010 at 12:00a.m.

Associated Press

WASHINGTON

Some major health-insurance companies no longer will issue certain types of policies for children, an unintended consequence of President Barack Obama’s health-care-overhaul law, state officials said Friday.

Florida Insurance Commissioner Kevin McCarty said several big insurers in his state will stop issuing new policies that cover children individually. Oklahoma Insurance Commissioner Kim Holland said a couple of local insurers in her state are doing likewise.

In Florida, Blue Cross and Blue Shield, Aetna, and Golden Rule — a subsidiary of UnitedHealthcare — notified the insurance commissioner that they will stop issuing individual policies for children, said Jack McDermott, a spokesman for McCarty.

The major types of coverage for children — employer plans and government programs — are not affected by the disruption. But a subset of policies — those that cover children as individuals — may run into problems. Even so, insurers are not canceling children’s coverage already issued but refusing to write new policies.

The administration reacted sharply to the pullback. “We’re disappointed that a small number of insurance companies are taking this unwarranted and unnecessary step,” said Jessica Santillo, a spokeswoman for the Health and Human Services department.

Starting later this year, the health-care-overhaul law requires insurers to accept children regardless of medical problems — a major early benefit of the complex legislation. Insurers are worried that parents will wait until kids get sick to sign them up.