Four sources deeply involved in the Affordable Care Act tell NBC News that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”
None of this should come as a shock to the Obama administration. The law states that policies in effect as of March 23, 2010 will be “grandfathered,” meaning consumers can keep those policies even though they don’t meet requirements of the new health care law. But the Department of Health and Human Services then wrote regulations that narrowed that provision, by saying that if any part of a policy was significantly changed since that date -- the deductible, co-pay, or benefits, for example -- the policy would not be grandfathered.
Buried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, “40 to 67 percent” of customers will not be able to keep their policy. And because many policies will have been changed since the key date, “the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range.”
That means the administration knew that more than 40 to 67 percent of those in the individual market would not be able to keep their plans, even if they liked them.
Yet President Obama, who had promised in 2009, “if you like your health plan, you will be able to keep your health plan,” was still saying in 2012, “If [you] already have health insurance, you will keep your health insurance.”
“This says that when they made the promise, they knew half the people in this market outright couldn’t keep what they had and then they wrote the rules so that others couldn’t make it either,” said Robert Laszewski, of Health Policy and Strategy Associates, a consultant who works for health industry firms. Laszewski estimates that 80 percent of those in the individual market will not be able to keep their current policies and will have to buy insurance that meets requirements of the new law, which generally requires a richer package of benefits than most policies today.
The NBC article drew an immediate and fierce reaction from senior White House staffers on social media.
FACT: Nothing in #Obamacare forces people out of their health plans. No change is required unless insurance companies change existing plans.
— Valerie Jarrett (@vj44) October 29, 2013
Curiously, the NBC story disappeared for awhile on Monday night before re-appearing at a different URL- at first with a key paragraph missing and then with the original content posted.
White House press secretary Jay Carney at first blamed the cancellation notices on 'routine turnover within the insurance industry' and Medicare chief Marilyn Tavenner said it was the insurance industry that was to blame, not the Obama Administration. However, the insurance industry claims that the cancellation notices are being sent out because the current policies aren't in compliance with 0bamacare.
Elsewhere, Senator Mary Landrieu [D- LA] claimed that Democrats had only promised Americans could keep their insurance policies if it was "good insurance".
According to Senator Mary Landrieu of Louisiana, Democrats had only promised that Americans could keep their insurance if it was "good insurance."
"We said when we passed that, 'If you had insurance that was good insurance that you wanted to keep it, you could keep it,'" Landrieu said.
She declined to say if she would support a measure to let Americans keep the plans they had in 2013. "I haven't looked at it specifically," Landrieu said.
So first the White House and the Democrats denied that there was any widespread cancellations of insurance policies taking place, but when the reports of previously insured people receiving cancellations notices or being placed into newer, cost-prohibitive policies for the same level of coverage thanks to Barack Obama's landmark healthcare law became too numerous to ignore, the spin was that those policies millions of Americans were losing were crappy to begin with and that the insurance industry was to blame- all while making sure the individual mandate wasn't delayed during this month's government shutdown.
Other Democrat senators, including those up for re-election in red or swing states, declined to comment on the cancellations
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