Kaiser Health News is reporting that most plans are ending policies sold after Obamacare passed in March 2010, but at least a few are cancelling policies sold to people with pre-existing medical conditions.
Kaiser Health News reported insurers in several states said they'd sent notices -- including Florida Blue, which ended about 300,000 policies, about 80 percent of its individual policies in the state.
Kaiser Permanente in California has sent notices to 160,000 people – about half of its individual business in the state.
Insurer Highmark in Pittsburgh is dropping about 20 percent of its individual market customers, while Independence Blue Cross, the major insurer in Philadelphia, is dropping about 45 percent, Kaiser Health News reported.
The report said new policies being offered to the cancelled customers offer better coverage, in some cases, for comparable cost -- especially after the inclusion of federal subsidies for those who qualify.
Obamacare requires policies sold in the individual market to cover 10 "essential" benefits, such as prescription drugs, mental health treatment and maternity care.
In addition, insurers can't reject people with medical problems or charge them higher prices. The policies must also cap consumers' annual expenses at levels lower than many plans sold before the new rules.
The cancellation letters, which began in August, were shocking to many because President Barack Obama had promised that Americans would be able to keep their insurance plans if they liked them.
According to health policy expert Bob Laszewski, roughly 16 million Americans will lose their current plans because of Obamacare, the Weekly Standard reported.
The individual health insurance market currently totals about 19 million people, but because the Obama administration's regulations on grandfathering existing plans were so stringent, about 85 percent of those are not grandfathered and must comply with Obamacare at their next renewal.
Critics say insurers may be "doing this as an opportunity to push their populations into the exchange and purge their systems" of policyholders they no longer want, Jerry Flanagan, a lawyer with Consumer Watchdog in California, told Kaiser Health News.
Insurers deny that, saying they are encouraging existing customers to re-enroll in their new plans.
"We continue to cover people with all types of health conditions," Highmark spokeswoman Kristin Ash said.
She said some policyholders who may have faced limited coverage for their medical conditions will get new plans with "richer benefits," and the policies "in most cases will be at a lower rate."
Some people receiving cancellations say it looks like their costs will go up, despite studies projecting that about half of all enrollees will get income-based subsidies, Kaiser Health News reported.
For example, Kris Malean, 56, who lives outside Seattle, has a health policy that costs $390 a month with a $2,500 deductible and $10,000 in potential out-of-pocket costs for such things as doctor visits, drug costs or hospital care.
As a replacement, Regence Blue Shield is offering her a plan for $79 more a month with a deductible twice as large as what she pays now, but which limits her potential out-of-pocket costs to $6,250 a year, including the deductible.
"My impression was . . . there would be a lot more choice, driving some of the rates down," Malean, who does not think she is eligible for a subsidy, told Kaiser Health News.
Regence spokeswoman Rachelle Cunningham said the new plans offer consumers broader benefits, which "in many cases translate into higher costs."
Blue Shield of California sent roughly 119,000 cancellation notices out in mid-September, about 60 percent of its individual business. About two-thirds of those policyholders will see rate increases in their new policies, spokesman Steve Shivinsky told Kaiser Health News.
"There is going to be a certain amount of churn in the marketplace as people have to make their decisions," Shivinsky said.