The Herald Bulletin

Morning Update

Nation & World

October 29, 2013

Health policy cancellations: New blow for admin.

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 business 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.

 

1
Text Only
Nation & World
  • news_marathonsecurity.jpg Boston Marathon organizers confident of safe race

    The arrest of a man with a rice cooker in his backpack near the Boston Marathon finish line led police to step up patrols Wednesday, while organizers sought to assure the city and runners of a safe race next week.

    April 17, 2014 1 Photo

  • news_diabetescomplications.jpg Study: Diabetic heart attacks and strokes falling

    In the midst of the diabetes epidemic, a glimmer of good news: Heart attacks, strokes and other complications from the disease are plummeting.

    April 17, 2014 1 Photo

  • news_skoreaferry.jpg Fears rise for missing in South Korea ferry sinking

    Fears rose Thursday for the fate of 289 passengers still missing more than 24 hours after their ferry flipped onto its side and filled with water off the southern coast of South Korea.

    April 16, 2014 1 Photo

  • news_ukraineprotests.jpg Pro-Russian gunmen make inroads in eastern Ukraine

    The well-armed, Moscow-backed insurgency sowing chaos in eastern Ukraine scored a new victory Wednesday, seizing armored vehicles and weapons from underequipped government forces, then rolling through two cities to a hero’s welcome.

    April 16, 2014 1 Photo

  • news_detroitsunset.jpg Detroit still needs $350M from state lawmakers

    Pressure was building Wednesday for Michigan lawmakers to commit $350 million to Detroit pensions, a day after the city reached tentative agreements with pension funds and a retiree group to reduce payouts.

    April 16, 2014 1 Photo

  • news_malaysiaplanesearch.jpg Sub makes second dive to search for Malaysian plane

    As a robotic submarine dived into the ocean to look for lost Flight 370, angry Chinese relatives stormed out of a teleconference meeting Wednesday to protest the Malaysian government for not addressing them in person.

    April 16, 2014 1 Photo

  • 3 APTOPIX Police Conver_Unde-1.jpg Feds: Boston bombing suspect not entitled to '11 murder file

    Federal prosecutors have told a judge they have no evidence that Boston Marathon bombing suspect Dzhokhar Tsarnaev knew about his brother's alleged role in a triple slaying in Waltham two years before the bombings.

    April 16, 2014 1 Photo

  • Boston police safely blow up suspicious backpacks

    Survivors, first responders and relatives of those killed in the Boston Marathon bombing marked the anniversary Tuesday with tributes that combined sorrow over the loss of innocent victims with pride over the city's resilience in the face of a terror attack.

    April 16, 2014

  • 292 missing, 4 dead in South Korea ferry disaster

    A ferry carrying 459 people, mostly high school students on an overnight trip to a tourist island, sank off South Korea's southern coast on Wednesday, leaving nearly 300 people missing despite a frantic, hours-long rescue by dozens of ships and helicopters. At least four people were confirmed dead and 55 injured.

    April 16, 2014

  • GM sales eyed for impact of ignition switch recall

    As General Motors shows off its newest cars and trucks in New York this week, analysts are watching for signs that consumers are shying away from the ones sitting on dealer lots.

    April 15, 2014

More Resources from The Herald Bulletin
AP Video
Disbanding Muslim Surveillance Draws Praise Hundreds Missing After South Korean Ferry Sinks Passengers Abuzz After Plane Hits Swarm of Bees Boston Bomb Scare Defendant Appears in Court Pistorius Trial: Adjourned Until May 5 Diaz Gets Physical for New Comedy Raw: Ferry Sinks Off South Korean Coast Town, Victims Remember Texas Blast Freeze Leaves Florida Panhandle With Dead Trees At Boston Marathon, a Chance to Finally Finish Are School Dress Codes Too Strict? Raw: Fatal Ferry Boat Accident Suspicious Bags Found Near Marathon Finish Line Boston Marks the 1st Anniversary of Bombing NYPD Ends Muslim Surveillance Program 8-year-old Boy Gets His Wish: Fly Like Iron Man Sex Offenders Arrested in Slayings of CA Women India's Transgenders Celebrate Historic Ruling Tributes Mark Boston Bombing Anniversary Raw: Kan. Shooting Suspect Faces Judge
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Helium debate
Helium