Americans may be able to keep their individual insurance plans for one more year, under a fix offered by President Obama on Thursday to address a controversial provision of the Affordable Care Act.
The deal is meant to mollify millions of people enraged after their insurers canceled policies that do not meet Obamacare requirements. But how many it will ultimately help remains to be seen.
The uproar over the cancellations has ensnared the White House for weeks, shining a spotlight on Obama’s previous promise that people who liked their insurance plans can keep them.
“This fix won’t solve every problem for every person. But it’s going to help a lot of people,” the president said at the White House. “We are going to do everything we can to help the Americans who’ve received these cancellation notices.”
But the fix, as reported earlier by CNN’s Dana Bash, puts the onus of the renewals outside the president’s control: The administration is not requiring insurers or state insurance commissioners to extend the existing plans, but instead is letting them offer an additional year of coverage.
Also, insurers must notify policyholders of the difference in benefits between their policies and the Obamacare plans available on the insurance exchanges. And the companies must inform people that additional policies are available on the exchanges and that subsidies may be available to those who qualify.
Not everyone who has received a cancellation notice, however, may be able to extend.
Since insurance is regulated at the state level, it remains up to the commissioners to permit the extensions and the companies to do so. The president noted that not all commissioners may agree to extensions. At least four states — California, Idaho, Virginia and Kentucky — are requiring all individual plans adhere to Obamacare rules.
The insurance industry said the reversal could cause major problems, including a hike in premiums if fewer younger and healthier people opt to buy in the exchanges.
“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,” said Karen Ignagni, chief executive of America’s Health Insurance Plans, an industry trade group. ” Additional steps must be taken to stabilize the marketplace and mitigate the adverse impact on consumers.”
In his remarks, Obama said he didn’t want his signature policy to be the reason people are losing their insurance.
“The key point is that it allows us to be able to say to the folks who receive these notices, look, you know, I, the president of the United States, and the insurance — the insurance model of the Affordable Care Act — is not going to be getting in the way of you shopping in the individual market that you used to have,” he said.
But he also stressed that the reason for health reform is that the current system did not work well, and that Americans will be able to find better quality insurance on the exchanges.
“It’s important that we don’t pretend that somehow that’s a place worth going back to,” he said, of the existing individual market. “Too often, it works fine, as long as you stay healthy. It doesn’t work well when you’re sick.”
Also, in announcing the changes Thursday, Obama apologized for the rough start to enrollment in the federal and state exchanges. The websites have been marred by major technological problems that have stymied many visitors from registering accounts, determining whether they are eligible for subsidies and picking insurance plans.
“We fumbled the roll out on this health care law,” he said.
Only 106,185 people signed up for insurance in the first month, with fewer than 27,000 of them going through the federal healthcare.gov site, which is handling enrollment for 36 states. And the site is still far from fully operational, leaving tech experts racing to get it working by month’s end, as the administration promised.
Obama said the website healthcare.gov will see “marked and noticeable” improvement.
Americans have until March 31 for sign up for a plan, but people must select and pay for a plan by Dec. 15 for coverage to start Jan. 1.