Canceled Policies Heat Up Health Fight - Concerns Extend Beyond Troubled Insurance Website; While insurers may keep selling current customers existing plans that date to March 2010 or before, many are citing the law as they end old policies.
From The Wall Street Journal:
Problems surrounding the launch of the federal health-care law broadened Tuesday, as concerns that thousands of Americans are getting insurance-cancellation notices bubbled over at a hearing on Capitol Hill.
Highlighting a growing number of such notices, Republicans trained their fire on President Barack Obama, who said in 2009, "If you like your health-care plan, you will be able to keep your health-care plan. Period." The president repeated that message numerous times before the law passed in 2010, and some Democrats said he had left them ill-prepared to respond to the latest charge, which follows the botched launch of the website intended to help Americans sign up for new policies.
At issue are insurance-plan changes affecting millions of Americans who buy coverage through the individual market because they can't get it from an employer or government program. Under the law, most new plans aimed at individuals must offer more-generous benefits—and often come at a higher price.
While insurers may keep selling current customers existing plans that date to March 2010 or before, many are citing the law as they end old policies.
The issue, while long known in health-policy circles, pushed its way to the national stage as more people around the country received cancellation notices. Some found they would have to pay more for coverage because newly available plans cover maternity care and don't cap payouts—benefits required under the new law that customers previously could have chosen to go without.
Also, the law says plans can no longer charge sicker people more, meaning those in good health may lose a pricing edge, while others may see their costs fall significantly.
The cancellation notices carried an additional sting because of the technology problems at the HealthCare.gov portal, which officials had been counting on to showcase new insurance options and federal subsidies. People who received cancellation notices may be unable to shop for new policies online and figure out whether they are eligible for subsidies. The federal site serves consumers in 36 states that declined to run their own health-insurance exchanges.
The twin issues of plan cancellations and the technology problems are expected to dominate a House hearing Wednesday at which Health and Human Services Secretary Kathleen Sebelius will testify for the first time since the website was launched Oct. 1.
The White House played down the significance of the cancellation issue by saying it affected only a sliver of Americans who already buy insurance on their own. It argued that the Affordable Care Act ultimately would improve coverage for millions who previously were blocked from the market because of illnesses or who received only skimpy benefits.
"What we're talking about here is the 5% in the country who currently purchase insurance on the individual market, and that market has been like the Wild West. It has been underregulated," spokesman Jay Carney said. He said the existing plans are "almost by definition providing less than minimal benefits" and may "charge you twice as much if you're a woman."
Earlier this month, Tom Luebchow, a 54-year-old small-business owner in Winston-Salem, N.C., received a letter from Blue Cross & Blue Shield of North Carolina telling him his individual health plan would be canceled and that the cost of coverage for his family would more than triple—to over $1,000 a month. He said that after the initial shock wore off, it was replaced by anger because he had to pay for benefits like pediatric eye exams that he would never use.
Mr. Luebchow said he won't qualify for subsidies for himself, his wife and 20-year-old son. "At 54 years old, I'm working my butt off and making a decent living, but now I feel penalized since I make too much money. Now you tell me the affordable part of that," he said.
As many as 10 million consumers are expected to have their health plans terminated by their insurers effective Jan. 1 or after, insurance experts said, meaning that millions of cancellation letters are likely to go out during the fall enrollment season.
About 15.4 million people, or about 5% of the U.S. population, are covered under individual health plans, according to the nonpartisan Kaiser Family Foundation. Gary Claxton, an expert on private insurance at the foundation, said the cancellation letters shouldn't have been a surprise, since the health law made clear that certain existing policies wouldn't meet the new standards.
Some policyholders expected to be grandfathered into older plans. But insurers said they canceled some plans out of concern they could become less profitable as membership declines.
The issue emerged as topic A for Republican critics of the law on Tuesday, outweighing the website troubles.
"The president likes to say that Obamacare is about more than just a website," said Senate GOP Leader Mitch McConnell of Kentucky. "He's absolutely right. And that's why fixing a website won't solve the larger problem here. The larger problem is Obamacare itself."
House Democratic Whip Steny Hoyer (D., Md.) told reporters that Democrats and Mr. Obama should have been "more precise" when they said if Americans liked their health insurance, they could keep it.
"We knew there would be some policies that would not qualify and therefore people would be required to get more extensive coverage, and of course that coverage is available in the exchange," Mr. Hoyer said.
The administration is trying to refocus attention on potential gains from the law by sending the president to Massachusetts on Wednesday, where he is expected to point to the positive effects of that state's health overhaul, which served as a model for the federal law.
At the hearing Wednesday before the House Energy and Commerce Committee, Ms. Sebelius is expected to say the problems with the insurance exchanges are "not acceptable," according to an advance text, but to defend herself against calls that she resign. Her spokeswoman, Joanne Peters, said the secretary "is committed to getting this right."
Republicans on the committee are expected to talk about a bill they introduced Monday that would authorize insurance carriers to continue offering all plans currently sold on the individual market
On Tuesday, the House Ways and Means Committee heard testimony from one of Ms. Sebelius's subordinates, Centers for Medicare & Medicaid Services Administrator Marilyn Tavenner, who apologized for the website's troubles and said they were being gradually fixed.
Some fixes have been short-lived. The data center supporting the troubled HealthCare.gov site went down again Tuesday, a day after connectivity was restored following a 16-hour outage, and was kept down overnight for maintenance. The failure was confirmed in a statement by a spokesman for Verizon Communications Inc.'s Verizon Enterprise Solutions, which owns Terremark, the company operating the data center.
Problems surrounding the launch of the federal health-care law broadened Tuesday, as concerns that thousands of Americans are getting insurance-cancellation notices bubbled over at a hearing on Capitol Hill.
Highlighting a growing number of such notices, Republicans trained their fire on President Barack Obama, who said in 2009, "If you like your health-care plan, you will be able to keep your health-care plan. Period." The president repeated that message numerous times before the law passed in 2010, and some Democrats said he had left them ill-prepared to respond to the latest charge, which follows the botched launch of the website intended to help Americans sign up for new policies.
At issue are insurance-plan changes affecting millions of Americans who buy coverage through the individual market because they can't get it from an employer or government program. Under the law, most new plans aimed at individuals must offer more-generous benefits—and often come at a higher price.
While insurers may keep selling current customers existing plans that date to March 2010 or before, many are citing the law as they end old policies.
The issue, while long known in health-policy circles, pushed its way to the national stage as more people around the country received cancellation notices. Some found they would have to pay more for coverage because newly available plans cover maternity care and don't cap payouts—benefits required under the new law that customers previously could have chosen to go without.
Also, the law says plans can no longer charge sicker people more, meaning those in good health may lose a pricing edge, while others may see their costs fall significantly.
The cancellation notices carried an additional sting because of the technology problems at the HealthCare.gov portal, which officials had been counting on to showcase new insurance options and federal subsidies. People who received cancellation notices may be unable to shop for new policies online and figure out whether they are eligible for subsidies. The federal site serves consumers in 36 states that declined to run their own health-insurance exchanges.
The twin issues of plan cancellations and the technology problems are expected to dominate a House hearing Wednesday at which Health and Human Services Secretary Kathleen Sebelius will testify for the first time since the website was launched Oct. 1.
The White House played down the significance of the cancellation issue by saying it affected only a sliver of Americans who already buy insurance on their own. It argued that the Affordable Care Act ultimately would improve coverage for millions who previously were blocked from the market because of illnesses or who received only skimpy benefits.
"What we're talking about here is the 5% in the country who currently purchase insurance on the individual market, and that market has been like the Wild West. It has been underregulated," spokesman Jay Carney said. He said the existing plans are "almost by definition providing less than minimal benefits" and may "charge you twice as much if you're a woman."
Earlier this month, Tom Luebchow, a 54-year-old small-business owner in Winston-Salem, N.C., received a letter from Blue Cross & Blue Shield of North Carolina telling him his individual health plan would be canceled and that the cost of coverage for his family would more than triple—to over $1,000 a month. He said that after the initial shock wore off, it was replaced by anger because he had to pay for benefits like pediatric eye exams that he would never use.
Mr. Luebchow said he won't qualify for subsidies for himself, his wife and 20-year-old son. "At 54 years old, I'm working my butt off and making a decent living, but now I feel penalized since I make too much money. Now you tell me the affordable part of that," he said.
As many as 10 million consumers are expected to have their health plans terminated by their insurers effective Jan. 1 or after, insurance experts said, meaning that millions of cancellation letters are likely to go out during the fall enrollment season.
About 15.4 million people, or about 5% of the U.S. population, are covered under individual health plans, according to the nonpartisan Kaiser Family Foundation. Gary Claxton, an expert on private insurance at the foundation, said the cancellation letters shouldn't have been a surprise, since the health law made clear that certain existing policies wouldn't meet the new standards.
Some policyholders expected to be grandfathered into older plans. But insurers said they canceled some plans out of concern they could become less profitable as membership declines.
The issue emerged as topic A for Republican critics of the law on Tuesday, outweighing the website troubles.
"The president likes to say that Obamacare is about more than just a website," said Senate GOP Leader Mitch McConnell of Kentucky. "He's absolutely right. And that's why fixing a website won't solve the larger problem here. The larger problem is Obamacare itself."
House Democratic Whip Steny Hoyer (D., Md.) told reporters that Democrats and Mr. Obama should have been "more precise" when they said if Americans liked their health insurance, they could keep it.
"We knew there would be some policies that would not qualify and therefore people would be required to get more extensive coverage, and of course that coverage is available in the exchange," Mr. Hoyer said.
The administration is trying to refocus attention on potential gains from the law by sending the president to Massachusetts on Wednesday, where he is expected to point to the positive effects of that state's health overhaul, which served as a model for the federal law.
At the hearing Wednesday before the House Energy and Commerce Committee, Ms. Sebelius is expected to say the problems with the insurance exchanges are "not acceptable," according to an advance text, but to defend herself against calls that she resign. Her spokeswoman, Joanne Peters, said the secretary "is committed to getting this right."
Republicans on the committee are expected to talk about a bill they introduced Monday that would authorize insurance carriers to continue offering all plans currently sold on the individual market
On Tuesday, the House Ways and Means Committee heard testimony from one of Ms. Sebelius's subordinates, Centers for Medicare & Medicaid Services Administrator Marilyn Tavenner, who apologized for the website's troubles and said they were being gradually fixed.
Some fixes have been short-lived. The data center supporting the troubled HealthCare.gov site went down again Tuesday, a day after connectivity was restored following a 16-hour outage, and was kept down overnight for maintenance. The failure was confirmed in a statement by a spokesman for Verizon Communications Inc.'s Verizon Enterprise Solutions, which owns Terremark, the company operating the data center.
posted by Sid Cottingham | 11:27 PM
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