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Policy cancellations: Obama will allow old plans

Posted on Friday, November 15, 2013 at 9:41 am

Bowing to pressure, President Barack Obama on Thursday

announced changes to his health care law to give insurance companies the

option to keep offering consumers plans that would otherwise be canceled.

The administrative changes are good for just one year, though senior

administration officials said they could be extended if problems with the

law persist. Obama announced the changes at the White House.

“This fix won’t solve every problem for every person, but it’s going to help

a lot of people,” the president said.

He acknowledged that “we fumbled the rollout of this health care law” and

pledged to “just keep on chipping away at this until the job is done.”

He also promised to work to regain the trust of the American people.

“I think it’s legitimate for them to expect me to have to win back some

credibility on this health care law in particular and on a whole range of

these issues in general,” he said.

Obama has been under enormous pressure from congressional Democrats to give

ground on the cancellation issue under the health care overhaul, a program

likely to be at the center of next year’s midterm elections for control of

the House and Senate.

It’s unclear what the impact of Thursday’s changes will be for the millions

of people who have already had their plans canceled. While officials said

insurance companies will now be able to offer those people the option to

renew their old plans, companies are not required to take that step.

The main industry trade group, America’s Health Insurance Plans, said

Obama’s offer comes too late and could lead to higher premiums, since

companies already have set 2014 rates based on the assumption that many

people with individual coverage will shift over to the new markets created

under Obama’s law.

Karen Ignagni, president of the industry group, didn’t speculate on whether

companies would extend coverage for those threatened with cancellation, but

warned in a statement that “changing the rules after health plans have

already met the requirements of the law could destabilize the market and

result in higher premiums for consumers.”

Insurance companies will be required to inform consumers who want to keep

canceled plans about the protections that are not included under those

plans. Customers will also be notified that new options are available

offering more coverage and in some cases, tax credits to cover higher


Under Obama’s plan, insurance companies would not be allowed to sell

coverage deemed subpar under the law to new customers, marking a difference

with legislation that House Republicans intend to put to a vote on Friday.

Only last week, Health and Human Services Secretary Kathleen Sebelius told a

Senate panel she doubted that retroactively permitting insurers to sell

canceled policies “can work very well since companies are now in the market

with an array of new plans. Many have actually added consumer protections in

the last three-and-a-half years.”

Republicans were unimpressed with the changes.

House Speaker John Boehner, speaking in advance of the president’s

announcement, insisted it was time to “scrap this law once and for all.”

“You can’t fix this government-run health care plan called Obamacare ,” he

said. “It’s just not fixable.”

Obama, for his part, made clear he would continue to fight ongoing attempts

to sink the whole program, saying, “I will not accept proposals that are

just another brazen attempt to undermine or repeal the overall law and drag

us back into a broken system.”

“We’re going to solve the problems that are there, we’re going to get it

right, and the Affordable Care Act is going to work for the American

people,” he pledged.

While the White House deals with the cancellation issue, the administration

is also promising improvements in a federal website so balky that

enrollments totaled fewer than 27,000 in October in 36 states combined. The

administration had said in advance the enrollment numbers would fall far

short of initial expectations. After weeks of highly publicized technical

woes, they did.

Adding in enrollment of more than 79,000 in the 14 states with their own

websites, the nationwide number of 106,000 October sign-ups was barely

one-fifth of what officials had projected – and a small fraction of the

millions who have received private coverage cancellations as a result of the

federal law.

The administration said an additional 1 million people have been found

eligible to buy coverage in the markets, with about one-third qualifying for

tax credits to reduce their premiums. Another 396,000 have been found

eligible for Medicaid, which covers low-income people.

Administration officials and senior congressional Democrats expressed

confidence in the program’s future. “We expect enrollment will grow

substantially throughout the next five months,” said Sebelius, who is in

charge of the program.

“Even with the issues we’ve had, the marketplace is working and people are

enrolling,” she added.

Despite the expressions, the White House worked to reassure anxious

Democrats who are worried about the controversial program, which they voted

into existence three years ago over Republican opposition as strong now as

it was then.

Obama said he regretted the political grief he’d caused members of his own

party who’d backed him on the health care law.

“There is no doubt that our failure to roll out the Affordable Care Act

smoothly has put a burden on Democrats, whether they’re running or not,

because they stood up and supported this effort through thick and thin,” he


Senate Democrats arranged a closed-door meeting for midday Thursday in the

Capitol with White House officials, who held a similar session Wednesday

with the House rank and file. Ahead of that meeting, Obama planned to speak

from the White House about new efforts to help Americans receiving insurance

cancellation notices.

So far, five Senate Democrats are on record in support of legislation by

Sen. Mary Landrieu, D-La., to make sure everyone can keep their present

coverage if they want to. The bill would require insurance companies to

continue offering existing policies, even if they fall short of minimum

coverage requirements in the law.

The measure has little apparent chance at passage, given that it imposes a

new mandate on the insurance industry that Republicans will be reluctant to


At the same time, a vote would at least permit Democrats to say they have

voted to repair some of the problems associated with the Affordable Care

Act, as many appear eager to do.

In a statement, Landrieu said Sens. Jeff Merkley of Oregon, Kay Hagan of

North Carolina and Mark Pryor of Arkansas were now supporting the

legislation, as is Sen. Dianne Feinstein of California. All but Feinstein

are on the ballot next year.

Across the Capitol, majority Republicans in the House set a vote for Friday

on legislation to permit insurance companies to continue selling existing

policies that have been ordered scrapped because they fall short of coverage

standards in the law.

While House passage of the measure is assured, each Democrat will be forced

to cast a vote on the future of a program that Republicans have vowed to

place at the center of next year’s campaign.

Democratic Rep. Mike Doyle of Pennsylvania, who voted for the initial Obama

health care bill, said Thursday that members of his caucus want an

opportunity to go on the record in support of allowing people to keep the

insurance they had.

Doyle told MSNBC in an interview that at a White House meeting Wednesday,

House Democrats told Obama about “the frustration level that many of us

have” with the health care roll-out.

Doyle said Democrats warned Obama that “if you don’t give us something by

Friday” to fix the insurance cancellation problem, then many Democrats are

likely to vote for the pending House bill sponsored by Republican Rep. Fred

Upton of Michigan, which would accomplish that goal.

The promise of keeping coverage was Obama’s oft-stated pledge when the

legislation was under consideration, a calling card since shredded by the

millions of cancellations mailed out by insurers.

Obama apologized last week for the broken promise, but aides said at the

time the White House was only considering administration changes, rather

than new legislation.

DAVID ESPO, Associated Press

JULIE PACE, Associated Press