keep their current health insurance plans under Obamacare, news
reports say, despite Obama’s continual assurances that they would.
Americans are discovering that they will not be able to keep their
current health insurance when the Affordable Care Act takes full
effect next year.
Reports Tuesday from CBS and NBC News document this development.
According to CBS, U.S. insurance firms have sent health policy
cancellation notices to more than 2 million people, with 800,000 in
New Jersey alone.
NBC estimates that 50 to 75 percent of the 14 million Americans who
purchase their health insurance as individuals on the open market can
expect a cancellation letter, as their policies don’t meet standards
mandated by the ACA.
Mr. Obama has long insisted that under his signature domestic
achievement Americans who like their current health plan can keep it.
That’s turning out to not be exactly true as the changes produced by
the sweeping Obamacare law work their way through the U.S. health
But the White House is pushing back against the notion that Obama was
misleading, saying that the cancellation notices are in part the
result of normal turnover in the individual insurance market.
“What the president said and what everybody said all along is that
there are going to be changes brought about by the Affordable Care Act
to create minimum standards of coverage,” said White House Press
Secretary Jay Carney.
So what’s going on here? It’s a complicated subject, so we’ll try to
explain it as simply as we can.
First, what’s at issue here are health insurance policies that people
buy themselves on the open market, because their employers do not
offer insurance, they work for themselves, or they don’t work and
don’t qualify for Medicare or Medicaid. It is not about
employer-provided health plans, which is how most workers get their
Second, Obamacare regulations raise the bar for such plans. The ACA
requires that they provide fuller and more complete coverage than they
did before. Many old cheaper plans that offer coverage only for
catastrophic events or that have high deductibles may not meet these
Third, there is a provision in the ACA that grandfathers in plans in
existence at time of the law’s passage in 2010. But there’s a catch:
They had to remain unchanged to qualify for this status. Any
alteration in beneficiaries, co-pays, coverage, or other relatively
routine item meant they had become new plans in the eyes of Obamacare.
So that’s the context. What’s happening now is that people with
un-grandfathered individual plans that don’t meet new rules are
getting notices that their current coverage is being canceled. In most
instances, they’re being offered a new policy that’s
Obamacare-compliant. But in some, maybe many, cases, that new policy
is more expensive, because it offers more.
Middle- and lower-income Americans might qualify for government
Obamacare subsidies to pay for this coverage, of course. But they’re
still facing sticker shock and a loss of their current insurance
“An accurate way to portray what’s happening might go like this:
Millions of people are finding out they’re being rolled over into new
policies that provide fuller coverage. But some may end up paying
more, even after the subsidies that the law provides,” writes
left-leaning Talking Points Memo editor Josh Marshall in a defense of
The political problem for the administration is that Obama’s
assurances that “if you like your doctor or health plan, you can keep
it” have turned out to be an oversimplification.
Republicans have seized on the issue as yet another example of
government overreach. They note that many people were satisfied with
cheaper individual policies that are no longer available due to the
ACA. That may be particularly true for younger, healthier people who
are now facing premium increases to offset the costs of older and
“Proposed new federal law: Everyone has to buy their cable network’s
most expensive package. More channels for you!” tweeted the
right-leaning commentator Allahpundit on Tuesday.
Was Obama’s promise a falsehood? Current New Jersey governor and
possible future GOP presidential candidate Chris Christie on CBS “This
Morning” Tuesday said flatly that “people weren’t told the truth.”
In a more nuanced view, the generally left-leaning Jonathan Chait
writes in New York Magazine’s “Daily Intelligencer” that there are
larger goals in the new rules, such as a reduction in the number of
medical bankruptcies and improvement of generally skimpy low-cost
Years prior to implementation, the notion of imposing new regulations
on the individual health-care market did not feel as if it were taking
people’s coverage away from them.
“In the current moment, with cancellation notices going out and
alternatives not yet available, it feels exactly like that,” Mr. Chait
writes. “Which is to say, a promise that felt like a mere
oversimplification at the time, and may eventually feel like one in
retrospect, currently feels like a lie.”