In voting 5-0, Covered California board members said allowing the older polices to continue would undermine the new insurancemarketplaces. Those policies are being ended because they do meet the more extensive requirements for essential benefits under the federal Affordable Care Act.

"There's no way to make the federal law work without this transition to ACA-compliant plans," board member Susan Kennedy said. "Delaying the transition isn't going to help anyone; it just delays the problems. I actually think that it's going to make a bad situation worse if we complicate it further."

The state insurance commissioner has said that 1.1 million Californians are receiving notices that their current individual healthinsurance policies will be discontinued in 2014, a deadline previously agreed to by the exchange and insurers. Nearly 220,000 policies will be extended until March because the companies failed to meet regulatory deadlines for notifying policy holders.