Health policy cancellations: New blow for White House

  • By Ricardo Alonso-Zaldivar and Stephen Ohlemacher Associated Press
  • Tuesday, October 29, 2013 8:07pm
  • Local NewsNation / world

WASHINGTON — Move over, website woes. Lawmakers confronted the Obama administration Tuesday with a difficult new health care problem — a wave of cancellation notices hitting individuals and small businesses who buy their own insurance.

At the same time, the federal official closest to the website apologized for its dysfunction in new sign-ups and asserted things are getting better by the day.

Medicare chief Marilyn Tavenner said it’s not the administration but insurers who are responsible for cancellation letters now reaching many of the estimated 14 million people who buy individual policies. And, officials said, people who get cancellation notices will be able to find better replacement plans, in some cases for less.

The Associated Press, citing the National Association of Insurance Commissioners, reported in May that many carriers would opt to cancel policies this fall and issue new ones. Administratively that was seen as easier than changing existing plans to comply with the new law, which mandates coverage of more services and provides better financial protection against catastrophic illnesses.

While the administration had ample warning of the cancellations, they could become another public relations debacle for President Barack Obama’s signature legislation. This problem goes to the credibility of one of the president’s earliest promises about the health care overhaul: You can keep your plan if you like it.

In the spring, state insurance commissioners started giving insurers the option of canceling existing individual plans for 2014, since the coverage required under Obama’s law is more robust. Some states directed insurers to issue cancellations. Large employer plans that cover most workers and their families are unlikely to be affected.

The cancellation notices are now reaching policyholders, and they’ve been complaining to their lawmakers — who were grilling Tavenner on Tuesday.

“Based on what little information the administration has disclosed, it turns out that more people have received cancellation notices for their health care plans this month than have enrolled in the (health care website),” said Ways and Means Chairman Dave Camp, R-Mich. He cited a news report of 146,000 cancellations in his state alone.

Up and down the dais, lawmakers chimed in with stories of constituents who had received similar notices. Republicans offered examples of people being asked to pay more.

Democrats countered by citing constituents who had been able to find lower-cost coverage than they have now. Ranking Democrat Sander Levin of Michigan said one of his constituents has been paying $800 a month for a BlueCrossBlueShield plan and managed to find comparable coverage for $77, after tax credits that lower the premiums.

Still, Levin added, “This has become a matter of legitimate discussion.”

It could take months to sort out the balance of individual winners and losers. There’s not a central source of statistics on how many people have gotten cancellations. Even the number of people who buy insurance individually is disputed.

It isn’t the administration’s fault, said Tavenner. “In fact the issuer has decided to change the plan; (they) didn’t have to.”

Obama’s promise dates back to June of 2009, when Congress was starting to grapple with overhauling the health care system to cover uninsured Americans.

“If you like your health care plan, you’ll be able to keep your health care plan, period,” the president said in remarks to the American Medical Association. “No one will take it away, no matter what.”

Some immediately saw the promise as too broad to deliver on, given that health plans are constantly being changed by the employers that sponsor them or by insurers directly.

Nonetheless, Democrats in Congress devised a complicated scheme called “grandfathering” to try to make good on Obama’s pledge. It shields plans from the law’s requirements, provided the plans themselves change very little. Insurers say it has proven impractical.

The White House weighed in Tuesday, with spokesman Jay Carney saying the changes are part of a transition to better coverage. “The good news,” he said, “is that for every one of these individuals who might have a plan that is almost by definition providing less than minimal benefits … you are now being offered a variety of options, including options by the very insurer that covers you already, for new coverage.”

Critics say that’s like an airline forcibly upgrading you from economy to business class, and exposing you to a higher ticket price.

Tavenner delivered the most direct mea culpa yet from the administration for the technical problems that have kept many Americans from signing up through HealthCare.gov.

“I want to apologize to you that the website has not worked as well as it should,” she told the committee.

The first senior official to publicly answer questions from lawmakers, Tavenner was pressed not only on what went wrong with the website, but also whether lawmakers can trust recent promises that things will be running efficiently by the end of November.

She declined to provide enrollment numbers, repeating nearly 20 times they will not be available until mid-November. But she did try to lower expectations of a strong initial sign-up. “We expect the initial number to be small,” Tavenner said.

An internal memo obtained by The Associated Press showed that the administration expected nearly 500,000 uninsured people to sign up for coverage in October, the program’s first month. Committee chairman Camp told Tavenner that by his math, the administration appears headed for less than a fourth of that.

Outside contractors testified last week that there wasn’t sufficient time to test the complex online enrollment system, which froze the day it was launched, Oct. 1.

The website is supposed to be the online portal to coverage for people who don’t have health plans on the job. Its audience is not only uninsured Americans but those who already purchase coverage individually.

Under the law, middle-class people can qualify for tax credits to make private health insurance more affordable, while low-income people will be steered to Medicaid in states agreeing to expand that safety net program.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

A firefighter stands in silence before a panel bearing the names of L. John Regelbrugge and Kris Regelbrugge during the ten-year remembrance of the Oso landslide on Friday, March 22, 2024, at the Oso Landslide Memorial in Oso, Washington. (Ryan Berry / The Herald)
‘Flood of emotions’ as Oso Landslide Memorial opens on 10th anniversary

Friends, family and first responders held a moment of silence at 10:37 a.m. at the new 2-acre memorial off Highway 530.

Julie Petersen poses for a photo with images of her sister Christina Jefferds and Jefferds’ grand daughter Sanoah Violet Huestis next to a memorial for Sanoah at her home on March 20, 2024 in Arlington, Washington. Peterson wears her sister’s favorite color and one of her bangles. (Annie Barker / The Herald)
‘It just all came down’: An oral history of the Oso mudslide

Ten years later, The Daily Herald spoke with dozens of people — first responders, family, survivors — touched by the deadliest slide in U.S. history.

Victims of the Oso mudslide on March 22, 2014. (Courtesy photos)
Remembering the 43 lives lost in the Oso mudslide

The slide wiped out a neighborhood along Highway 530 in 2014. “Even though you feel like you’re alone in your grief, you’re really not.”

Director Lucia Schmit, right, and Deputy Director Dara Salmon inside the Snohomish County Department of Emergency Management on Friday, March 8, 2024, in Everett, Washington. (Ryan Berry / The Herald)
How Oso slide changed local emergency response ‘on virtually every level’

“In a decade, we have just really, really advanced,” through hard-earned lessons applied to the pandemic, floods and opioids.

Ron and Gail Thompson at their home on Monday, March 4, 2024 in Oso, Washington. (Olivia Vanni / The Herald)
In shadow of scarred Oso hillside, mudslide’s wounds still feel fresh

Locals reflected on living with grief and finding meaning in the wake of a catastrophe “nothing like you can ever imagine” in 2014.

Kelli Littlejohn, who was 11 when her older sister Melissa Lee was murdered, speaks to a group of investigators and deputies to thank them for bringing closure to her family after over 30 years on Thursday, March 28, 2024, at Snohomish County Superior Court in Everett, Washington. (Ryan Berry / The Herald)
‘She can rest in peace’: Jury convicts Bothell man in 1993 killing

Even after police arrested Alan Dean in 2020, it was unclear if he would stand trial. He was convicted Thursday in the murder of Melissa Lee, 15.

Ariel Garcia, 4, was last seen Wednesday morning in an apartment in the 4800 block of Vesper Dr. (Photo provided by Everett Police)
Everett police searching for missing child, 4

Ariel Garcia was last seen Wednesday at an apartment in the 4800 block of Vesper Drive. The child was missing under “suspicious circumstances.”

The rezoned property, seen here from the Hillside Vista luxury development, is surrounded on two sides by modern neighborhoods Monday, March 25, 2024, in Lake Stevens, Washington. (Ryan Berry / The Herald)
Despite petition, Lake Stevens OKs rezone for new 96-home development

The change faced resistance from some residents, who worried about the effects of more density in the neighborhood.

Rep. Suzan DelBene, left, introduces Xichitl Torres Small, center, Undersecretary for Rural Development with the U.S. Department of Agriculture during a talk at Thomas Family Farms on Monday, April 3, 2023, in Snohomish, Washington. (Olivia Vanni / The Herald)
Under new federal program, Washingtonians can file taxes for free

At a press conference Wednesday, U.S. Rep. Suzan DelBene called the Direct File program safe, easy and secure.

Former Snohomish County sheriff’s deputy Jeremie Zeller appears in court for sentencing on multiple counts of misdemeanor theft Wednesday, March 27, 2024, at Snohomish County Superior Court in Everett, Washington. (Ryan Berry / The Herald)
Ex-sheriff’s deputy sentenced to 1 week of jail time for hardware theft

Jeremie Zeller, 47, stole merchandise from Home Depot in south Everett, where he worked overtime as a security guard.

Everett
11 months later, Lake Stevens man charged in fatal Casino Road shooting

Malik Fulson is accused of shooting Joseph Haderlie to death in the parking lot at the Crystal Springs Apartments last April.

T.J. Peters testifies during the murder trial of Alan Dean at the Snohomish County Courthouse on Tuesday, March 26, 2024 in Everett, Washington. (Olivia Vanni / The Herald)
Bothell cold case trial now in jury’s hands

In court this week, the ex-boyfriend of Melissa Lee denied any role in her death. The defendant, Alan Dean, didn’t testify.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.