Obama Fix for Canceled Health Policies

By CBS News

Published 11/14 2013 11:18AM

Updated 11/14 2013 11:52AM

CBS News

WASHINGTON, DC -- President Obama announced Thursday that his administration will let health insurers extend existing health plans on the individual and small-group markets into 2014. The administrative policy change will let insurers reach out to the millions of Americans being dropped from their plans so that they can renew their insurance for another year while the market adjusts to new Obamacare regulations.

Insurers that extend existing plans must also notify consumers of what protections these renewed plans do not include. They must also notify customers that there are more options available on the new Obamacare marketplaces that offer better coverage, and that tax credits are available for many consumers. While insurers will be able to let customers keep their existing plans for another year, they will not be able to let new customers buy these existing plans that do not meet new Obamacare standards.

Now that the new Obamacare insurance marketplaces are opening, more than 4,800,000 people across the country are being dropped from their insurance plans, according to the latest CBS News tally. Plans are being canceled if they fail to meet the health care law's 10 minimum standards, including maternity care, emergency visits, mental health treatment and pediatric dental care.

The dropped plans seemingly violate Mr. Obama's 2009 campaign pledge that, "If you have insurance that you like, then you will be able to keep that insurance."

House Speaker John Boehner, R-Ohio, on Thursday morning took the opportunity to pounce on the president, charging that his administrative fix wasn't good enough.

"It's clear the American people simply can't trust this White House," he said. "The only way to fully protect the American people is to scrap this law once and for all. There is no way to fix this."

The president's stance on the matter has shifted significantly in the past few weeks -- while he has now apologized for the issue and has acknowledged it is a problem, he initially suggested that he wasn't breaking his promise. Late last month, Mr. Obama pointed out that plans that existed before the Affordable Care Act was enacted were "grandfathered in" to the system -- consumers only lost coverage if insurers altered those policies after the law took effect. In that case, Mr. Obama said, insurers had to "replace them with quality, comprehensive coverage."

However, the problem has been compounded by the fact that many people have been unable or discouraged from shopping the new Obamacare marketplaces because of the significant technical problems with HealthCare.gov and some state-run Obamacare websites.

The Health and Human Services Department reported Wednesday that just over 106,000 people have enrolled in plans on the new marketplaces so far -- well below the approximately 500,000 enrollees the administration was expecting to see in the first month of open enrollment.

Republicans on Wednesday slammed the administration for the low enrollment figures, juxtaposing them with the millions being dropped from insurance plans that no longer meet Obamacare standards.

"More people in Michigan have had their health care plans cancelled than have enrolled nationwide," House Ways and Means Committee Chairman Dave Camp, R-Mich., said in a statement. "Given that these early enrollment numbers are inflated to include those just 'shopping' for a plan, it is clear that the real truth is even worse than we are being told."

The problem has also seriously alarmed Democrats in Congress. In recent days, six Democrats in the Senate -- five of whom are up for re-election next year -- joined onto a bill that would have made the same policy changes to Obamacare that Mr. Obama announced Thursday. One of those Democrats, however -- Sen. Joe Manchin, D-W.Va. -- said the problems with Obamacare extend beyond enrollment issues.

"They have more than a rollout problem," Manchin said on MSNBC Thursday morning. "There is a product problem. We have to make sure the products are there. And the market will determine that product."

Senate Democrats are meeting Thursday with White House officials, including White House Chief of Staff Denis McDonough, one day after House Democrats met with members of the administration and demanded that by Friday, the president put forward a plan to address the problem of dropped plans. House Democrats are also scheduled to receive a briefing Thursday afternoon from McDonough.

Rep. Steven Cohen, D-Tenn., characterized Wednesday's meeting as "a pretty frank and forthright discussion of the political fallout of the 'if you like your health care, you can keep it' statement.'"

On the Senate floor Thursday morning, Senate Minority Leader Mitch McConnell, R-Ky., said, "It's time for the Democrats to work with us to repeal this law and start over." Then, he and other Senate Republicans took turns sharing anecdotes on the Senate floor of people from their state who had been dropped from their plans.

The Republican-led House on Friday plans to vote on a bill called "Keep Your Health Plan Act," which would allow plans that existed on the individual market as of Jan. 1, 2013 to stay in effect through 2014. While the legislation would enact a policy change similar to the administration's, the White House has said it opposes the bill because it would allow insurers to sell 2013 plans in 2014 to anyone, not just customers who already have those plans. That, White House spokesman Jay Carney told reporters Tuesday, "creates all sorts of problems for insurers trying to meet the basic standards" set by the Affordable Care Act, undermining the whole law.

© 2013 CBS Interactive Inc. All Rights Reserved.

(story contributed by CBS News)

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