Obama under fire as Americans lose prior health plans

WASHINGTON Tue Oct 29, 2013 6:58pm EDT

The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely referred to as ''Obamacare'', outside the Jackson-Hinds Comprehensive Health Center in Jackson, Mississippi October 4, 2013. REUTERS/Jonathan Bachman

The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely referred to as ''Obamacare'', outside the Jackson-Hinds Comprehensive Health Center in Jackson, Mississippi October 4, 2013.

Credit: Reuters/Jonathan Bachman

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WASHINGTON (Reuters) - President Barack Obama is facing fresh attacks for his pledge that Americans who like their current healthcare plans can keep them under Obamacare, as reports pile up of thousands of Americans facing cancellation notices.

Accusations that the pledge was misleading are potentially a deeper threat to Obama than the website glitches that have plagued Healthcare.gov since its October 1 launch and allowed only a trickle of people to sign up on new federal insurance exchanges.

Obama has downplayed the problems with the website, saying it's like a cash register not working, and has stressed that the underlying product of the 2010 Affordable Care Act is "actually really good".

But critics of Obamacare have seized on the hundreds of thousands of Americans due to lose their current plans because they fail to include essential benefits required by the law, and are asking whether Obama misrepresented the law.

"Can you understand the level of frustration and concern about what many Americans perceive to be a false claim from the administration?" asked Representative Peter Roskam, an Illinois Republican, during a House oversight hearing on Tuesday featuring Marilyn Tavenner, a top U.S. official overseeing the law's rollout.

Tavenner, the administrator of the U.S. Centers for Medicare and Medicaid Services (CMS), apologized for problems with Healthcare.gov, but quickly came under fire about the Americans losing their current coverage plans.

Health and Human Services Secretary Kathleen Sebelius, who has faced Republican calls for her resignation, is scheduled to testify before another House panel on Wednesday and will likely confront similar questions about whether the administration misled the public about the benefits of Obamacare.

Obama is heading to Boston, Massachusetts, on Wednesday to promote Obamacare at the same spot where Mitt Romney signed Massachusetts' own healthcare law in 2006 as governor. Obama is expected to highlight how Massachusetts' health overhaul, which relied on similar insurance exchanges, also got off to a slow start.

The people at risk for policy cancellations are a portion of those in the pool of 15 million consumers, often self-employed, who do not get coverage through their employers or the government, and have individual policies.

The dropped policies are also reviving debate on a core premise of the healthcare law - that all Americans should have adequate coverage so that the costs of healthcare are spread across the population.

Democrats are also saying Obama could have phrased his plan retention pledge more accurately. "I think preciseness would have been better," House Minority Whip Steny Hoyer, the second-ranking Democrat in the House, told reporters.

Obama in 2009, while building support for the bill that would become the Affordable Care Act, or Obamacare, repeatedly said that Americans who liked their doctors or current healthcare plans could keep them. He reiterated the promise as recently as March.

'ESSENTIAL' BENEFITS

Now that the law is fully coming into effect, Americans are receiving notifications from their insurers that their current plans cannot continue because they do not cover certain "essential" benefits such as preventive care and mental health services as required by the law.

The idea was to phase out bare-bones plans that do not cover catastrophic events, sometimes to the surprise of the consumer, and also have the effect of increasing costs across the healthcare system.

When asked by a reporter on Tuesday whether Obama misled the public, White House spokesman Jay Carney redirected the conversation to state that it was not fair for taxpayers to absorb costs of the uninsured or under-insured.

"There was a debate about this and I'm sure there will continue to be a debate that a fundamental premise of the Affordable Care Act is that there ought to be minimum standards for insurance coverage for everybody," Carney said.

But some Americans are reporting sticker shock about the new plans their insurers are offering.

Kevin DeLashmutt, 53, who is self-employed in real estate in Seattle, Washington, said that over the summer he received a letter from his insurance company saying the plan he now has is no longer available.

The cheapest plan he could buy would cost $411, about twice his current premium, while the plan most like the one he has would cost about 150 percent more - $542.59.

"You used to be able to choose what to get based on what you need and what you can afford, including a high deductible," DeLashmutt said. "Let me manage my own risk. Those people in Washington, D.C., shouldn't get to make that decision for me."

MULTIPLE HEADACHES

Besides the rocky Obamacare rollout, Obama is facing protests from allies, including German Chancellor Angela Merkel, after it was revealed that the United States for years has spied on foreign heads of state.

The issues are distracting him from other policy goals, including comprehensive immigration reform.

It is unclear exactly how many Americans may lose their current coverage and whether they truly will be forced into more expensive plans.

The law does protect plans that were created before the March 2010 law and have not changed since then, but it is common industry practice for insurers to tweak plans year to year, leading to a flood of cancellations.

These people can either seek new "off exchange" policies from insurers, or try to find cheaper plans through the exchanges that come with a federal tax subsidy if their income is low enough.

If the glitches in the online marketplaces fail to be resolved, the government might have to reinforce low-tech alternatives such as call centers and paper applications, one expert said.

"If they can't enroll before the end of this year ... it's a serious burden on those people," said Joel Cantor, a public policy professor at Rutgers University who advises New Jersey on issues with the healthcare law.

Republicans have been able to harness the frustration to energize their latest attack on Obamacare.

"The problems don't stop at the technical failures of a website," said Representative Sam Johnson, a Republican from Texas, at the oversight hearing on Tuesday. "The real problem stems from the colossal failure to deliver what this law promised the American people."

(Reporting By Roberta Rampton; Additional reporting by Lewis Krauskopf, Sharon Begley, David Morgan and David Lawder; Writing by Karey Van Hall; Editing by Tim Dobbyn)

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Comments (51)
If insurance companies are not adding these services and cancelling catastrophic plans instead of enhancing them, how is the PPACA to blame and not the insurance companies? so their profits get dinged a bit big deal they make money on providing misery to people. they are the problem not the fix, any company that makes profit by denying healthcare to people can suck it up.

Oct 29, 2013 5:38pm EDT  --  Report as abuse
Bighammerman wrote:
If you’re mad now wait a while. This will drive your taxes way up and jobs way down. When the country’s revenue is 1 trillion dollars less that the operating expenses and the Federal Reserve is printing money as fast as it can to keep up, thing are really bad. Obama has deliberately miss managed the country’s finances. He is also messing with government contracts which the reason why there has been so much trouble with the ACA rollout. Tasks this large have to be contracted to competent companies that can handle it and not his friends. This will get worse as Obama’s lies become even more apparent like the one about not having to change plans and doctors. To Obama supporters, what flavor Kool aid did you drink?

Oct 29, 2013 5:40pm EDT  --  Report as abuse
4825 wrote:
The majority of the American people did not want anything to do with Obamacare. This is just the very early stage of a painful program for this country. The liberals used “good intentions” to drive this through and cram down on the American public. The sooner the country realizes that there are not any free lunches the better off we will be. It amazes me how people that are supposed to be smart think that more debt and borrowing is the answer to the economic problems that we face today. The ACA will be another costly anchor around the neck of America.

Oct 29, 2013 5:48pm EDT  --  Report as abuse
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