Illinois Department of Insurance Announces Exit of Unicare Health Insurance Companies from Illinois

CHICAGO - Unicare Health Insurance Company of the Midwest, Unicare Life & Health Insurance Company, and Unicare Health Plans of the Midwest Inc. (Unicare) have notified the Department of Insurance of their intent to exit the commercial, individual, small group, and large group health insurance markets in Illinois.  The Department has closely supervised this matter in order to protect the interests of Unicare's policyholders and to ensure that Unicare's exit is done in compliance with applicable law.

"The Department's most important priority is ensuring that Unicare's policyholders remain continuously enrolled in similar or identical coverage at similar or identical cost," said Michael T. McRaith, Director of the Department.  "Unicare policyholders should know that the Department will answer their questions and aid them through this transition."

The Department offers the following information for Unicare policyholders to consider:

Unicare must provide notice of its intent to exit the market
• The law requires that Unicare provide 180 days advance notice of its intent to exit the market to its individual and group policyholders.  215 ILCS 95/50(C)(2). 
• Unicare has reported to the Department that it notified individual and group policyholders of its intent to exit by letter dated October 27, 2009.  If you have not received notification from Unicare you should contact the company immediately. 
• If you are enrolled in a plan offered by the State and administered by the Department of Central Management Services, Bureau of Benefits, you will be contacted by that office directly regarding your enrollment options.

Your Unicare coverage will continue through your next renewal date
• Individual and group policyholders have the option to remain with Unicare until their coverage renewal date.  If a policyholder has a coverage renewal date prior to April 27, 2010, he or she may renew coverage and remain with Unicare until the next renewal or anniversary date in 2011.  For example, if a policyholder chooses to remain with Unicare and their renewal or anniversary date is February 1, 2010, their renewed coverage will not expire until February 2011.  If a policyholder's coverage renewal date is after April 27, 2010, coverage will expire on that date.

Blue Cross Blue Shield of Illinois (BCBS) will enroll any Unicare individual or group policyholder that wishes to leave Unicare prior to expiration of their existing coverage.  The Department stresses that policyholders are not required to switch to BCBS coverage.  The Department encourages all consumers to make informed decisions. 

You should consider the following when determining whether to switch to BCBS:

The BCBS offer will expire on December 1, 2009
• The opportunity to switch to BCBS coverage is limited - the deadline to file the appropriate paperwork is December 1, 2009.  If selected, coverage with BCBS will be effective January 1, 2010.

The BCBS coverage should closely resemble the coverage you have with Unicare
• In most cases, BCBS rates are equal or close to Unicare's rates.  BCBS will match, or approximately match, a previously provided Unicare renewal quote.  If BCBS is unable to match a Unicare benefit rate, it will adjust the rate to match the BCBS benefit plan being offered. 
• Due to different rating methodologies, a small portion of Unicare consumers may see a large difference in premium rates between their existing Unicare plan and the offered BCBS plan.  Please remember that there is no requirement that you accept a plan offered by BCBS.
• The BCBS provider network closely resembles or overlaps the Unicare provider network.  During the transition, BCBS will work with members who have care needs from providers outside the BCBS network.  The Department is also available to assist consumers in need of assistance with transition of care or other issues or questions.
• In the overwhelming majority of cases the plan year is a calendar year, so January 1 represents a new benefit plan year for policyholders with the usual resetting of deductibles and out-of-pocket maximum. 

Individual policyholders who choose a BCBS plan will not be subject to pre-existing limitation exclusions
• Individual policyholders may switch to a BCBS plan without underwriting and without pre-existing limitations regardless of how long they have been covered by Unicare.  Any exclusionary riders in place on the Unicare policy will be duplicated in the BCBS policy. 

• An individual policyholder who does not take the BCBS offer will be subject to medical underwriting and pre-existing condition limitations if they choose to go to another carrier.  If the individual is not insurable on the open market, coverage may not be accessible except through the Illinois Comprehensive Health Insurance Plan (www.chip.state.il.us), which requires a 6-month pre-existing condition waiting period.

Group policyholders of all sizes are guaranteed coverage by BCBS without any pre-existing limitation exclusions
• Small groups (2 to 50 employees) are guaranteed to be issued health coverage by any carrier marketing in the small group market, but will be re-underwritten for rating purposes.  Large groups (over 50 employees) are not guaranteed to be issued coverage but have more leverage when shopping the market due to the number of people insured.
• BCBS will take any Unicare group - regardless of size - that wishes to change coverage at this time. 
• BCBS will waive underwriting and pre-existing condition limitations for all groups that switch, regardless of creditable coverage.  Once again, there is no requirement that a group switch to BCBS coverage.  Groups may stay with Unicare until its coverage expires in accordance with the law.  However, consideration should be given to the likelihood that rates will increase and providers may leave the Unicare provider network.

More information
The Department's mission is to protect consumers by providing assistance and information, by efficiently regulating the insurance industry's market behavior and financial solvency, and by fostering a competitive insurance marketplace.  The Department assists consumers with all insurance complaints, including health, auto, life, and homeowners.  Consumers in need of information or assistance should visit the Department's Web site at www.insurance.illinois.gov or call our toll-free hotline at (877) 527-9431.