More Health Plan Cancellations are on the Way. Obamacare is to Blame.



At the end of last year, millions of Americans with individual insurance policies found out that, thanks to Obamacare, President Obama's repeated promise that anyone who liked their health plan could keep their health plan was not, in fact, true. 

This year, on the eve of a midterm election, it's about to happen again for hundreds of thousands of people across the country. 

As the policy news site Morning Consult notes today, there are reports in multiple states that hundreds or thousands will see their plans cancelled at the end of the year as a direct result of not meeting Obamacare's requirements. Some 14,000 people are expected to lose their current plans in Kentucky, and another 800 are projected to see their plans cancelled in Alaska. Both of those states are Senate battlegrounds with close races. 

According to the Albuquerque Journal, about 30,000 people will have their plans cancelled in New Mexico. The report leaves no question that Obamacare is the culprit, saying the plans will be cut off because they "don't meet the standards set by the health care law." 

Last month, reports surfaced indicating that, according to estimates produced by the state's insurance commission, as many as 250,000 people in Virginia will lose their existing plans this year. 

People who lose their plans are not necessarily doomed to go without insurance. If they stay on the individual market, they will have the opportunity to buy new plans through Obamacare's exchanges, and those plans may be subsidized. But that's not what Obama promised when selling the law. What he said was, "if you like your plan, you can keep your plan," not, "if you like your plan, it may well be cancelled, but you can purchase a different one through a government-run storefront that federal and state regulators have deemed compliant." Administration officials knew full well that the promise was impossible to keep, much as Clinton administration advisers knew the same thing during their push for health care reform in the 1990s. And yet President Obama went ahead and made the promise anyway, over and over, on camera, with no caveats, embracing a lie because it was politically convenient. 

The Obama administration's blame-shifting response to the latest round of plan cancellations is barely a response at all. A Health and Human Services (HHS) spokesperson tells The Hill that "as was the case before the Affordable Care Act, private insurance companies operate in a free market: they may choose to discontinue, change, and replace plans so long as they let their enrollees know their options."

It is perhaps debatable whether the heavily regulated health insurance industry can be credibly described as a "free market," but it's true that insurers can and do decide to cancel plans, and they often did before Obamacare. In this case, however, the cancellations are a direct result of Obamacare's rules and requirements, which were intentionally and explicitly designed to kill off plans that did not meet the law's particular standards. 

The HHS spokesperson also notes that last year, under heavy political pressure after Obama's obvious and repeated lie about keeping plans was exposed, the administration issued an update allowing insurers to keep many off-limits plans going through 2016, subject to the approval of state regulators. 

This move, which allows the administration to shift responsibility for plan cancellations to insurers and state officials, has been described as a fix, but it's not much of one: At most, it postpones the cancellations. Insurers and state regulators are not deciding whether or not to cancel plans that do not pass muster under Obamacare; they are merely deciding when. Ultimately, the law is to blame. 

*This article has been updated for clarity. 

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  1. But Obama is just helping those poor people with bad plans out by guiding them to getting the plans that they really want. They really didn’t like the plans that they had, but they didn’t know it, so Obama had to ‘nudge’ them towards the plans that they really like.

    You rethuglicans just can’t ever be happy, instead of thanking our president, you just want to criticize him because he’s black.

    1. Don’t forget that the Rethuglicans are motivated by greed, selfishness, and hate.

    2. They really didn’t like the plans that they had, but they didn’t know it

      False Consiousness, FTW.

  2. liked their health plan could keep their health plan

    Hell – anyone with half a brain knew it was a lie, but the media and the lefty writers let it pass without even a whimper. But we still get crap churned out by Vox that says “Obamacare is not a trainwreck.”

    1. Well you couldn’t expect Politifact to have time to check that unimportant, barely repeated claim. They had to get to the real whoopers, like “Obamacare is a government takeover of healthcare.”

  3. Uh, Obamacare isn’t to blame. The market is to blame.

    Also, reality deserves some of the blame.

    1. “Also, reality deserves some of the blame.”

      Only when you hope you can ignore it. Sorta like Wiley J. Coyote running straight off the edge of the cliff before looking down.

      1. In their defense, CongressCritters are experts at never looking down.

  4. Earlier this year we were told we were going to lose our coverage in May. Then Obama declared that some plans can exist longer (aka after the election), so now our plan will no longer be valid on January 1. I predict the timing of those cancellation notices will be important to the election. There have to be a lot of people in the same situation as I am.

    1. Indeed.

      I might have missed it – have they passed a law yet dictating that Open Enrollment period for all health plans must start no earlier than Nov 3 ?

      1. Hah, but they’ve tied themselves into a knot with certain consumer protections, like 60-day notices, yes? (I don’t know if that’s an IRS or HHS regulation or standard State practice, but it has the same effect.)

    2. I agree, and I bet the Odministration is meeting with a few State insurance commissioners and CEOs to help him past November 4.

    3. http://www.startribune.com/local/277366551.html

      DFL Gov. Mark Dayton’s administration originally planned to wait to release premium information until open enrollment begins, but it retreated under fire from Republicans who charged that he expected higher premiums and wanted to conceal them until after the election.

  5. “A Health and Human Services (HHS) spokesperson tells The Hill that “as was the case before the Affordable Care Act, private insurance companies…may choose to discontinue, change, and replace plans so long as they let their enrollees know their options.””

    This is true.

    However, the point was that these insurance companies are doing so in order to comply with the ACA. which is not “a free market” as clarified by that very fact.

    Its like someone was asked, “Did you shoot this person?” and they replied “Guns are known to be dangerous and firearms manufacturers should do as much as they can to help prevent violence

    1. The question that should have been asked in response to that statement would be =

      “Are you suggesting that insurance companies COULD HAVE CHOSEN to keep plans that failed to comply with the ACA, yet did not? That these specific cancellations are a consequence of ‘free choice’, and not federal regulation?”

      To which the bullshit evasive answer would likely have been,

      We can’t know what may have motivated any specific cancellations as many plans are different; many may have been attempting to raise premiums in excess of ACA limits, which would have required a change of plan in order to Protect Consumers…”

      This is called “selling the Bug as a Feature”

      See, because when the federal government purposely creates pressures that increase costs? and then passes a law saying you “Can not raise prices”?…

      Well then, those cancellations are *still the fault of private insurers*

      This makes sense if you’re a Prog.

      1. This makes sense if you’re a Prog mendacious cunt.

        FTFY, though I guess that’s pretty much the same thing.

    2. Mendacity at that level should be a punishable offense. First time is a warning, second time is immediate expulsion from the job with no appeal process.

      1. My grandfather used to say, “The first time is funny; the second time is silly; the third time you get a spanking.”

    3. What’s so very wrong about your comment is that, unless ACA has a provision Requiring the cancellation of non-compliant policies, they are NOT “doing so in order to comply with the ACA”; they are making private-company business decision. If you disagree with them and think they should instead have amended the existing policies, you should complain to Them about it.

      A basic requirement for having a free-market economy is the responsibility for people to not act like sheep and revoke their money from companies who fail to address your needs

  6. IF the Republicans have any sense at all, they’ll run commericals interspersing “If you like your plan, you can keep your plan” with some single mother who has three kids by the same man and just lost what was a good deal to her.

  7. Dumb as this law is, and as angry and frustrated as it makes me, I had never really seen it up close and personal. Until my employer sent out the following this past Monday:

    “Under the federal Affordable Care Act, high cost (or
    “Cadillac”) health plans will be subject to a 40 percent excise
    tax, beginning in 2018. The In-Network Only Premium Plan
    would qualify as a “Cadillac” plan subject to the excise tax.
    Primarily as a result of this significant future tax liability, X
    will no longer be offering this plan after 2014. Employees
    who are currently enrolled in this plan will have the option to
    select from X’s other three plans during open enrollment.
    Those currently enrolled in the terminating plan that do not
    choose a new plan or do not waive coverage by the open
    enrollment deadline will automatically be enrolled in X’s
    Medium plan.”

    So there you have it. I knew “If you like it…” was garbage right from the start but here is more concrete proof. Also learned they have been cutting some of the hourly employees to get under the 30 hours threshold. Again, who didn’t see (or want to see) stuff like this happening?

    1. Any water cooler talk about this?

      1. A decent amount, but not the backlash as I expected. Let’s just say a lot of the people where I work probably voted for the guy twice and might even do so a 3rd time if given the opportunity. I’m still in my 20’s and am (thankfully) healthy so I do not have the premium plan. It’s obviously not information everyone readily shares with one another but I imagine a decent number of people will have to change what they’ve had since this announcement is at the very top of the open enrollment communication thus far.

    2. “If you like the lawyer you have now, you can keep him.”

      Imagine the wailing if any politician suggested reforming the lawyer system the way politicians regularly change the health care system.

      1. Nobody needs a Cadillac lawyer.

      2. Just as the VA is a model for health care for all of America, public defenders’ offices are a model for legal representation for all of America.

      3. 100 million people are without legal counsel. So many thousands go bankrupt every year due to the inability to defend against lawsuits. We need an Affordable Counsel Act.

    3. That’s crazy. How does an in-network-only plan counts as a “cadillac” plan?

      I get the idea that health plans that cover everything willy-nilly are problematic, but if the plan is an in-network plan then they are already limiting what they are covering.

      Do you know what features of the plan made it count as a “cadillac plan”?

  8. “It is perhaps debatable whether the heavily regulated health insurance industry can be credibly described as a “free market,”

    No it isn’t debatable.

    It’s not a free market and hasn’t been for a very long time.

    Obamacare ramped up the un-freeness to the nth degree.

  9. “The Obama administration’s blame-shifting response to the latest round of plan cancellations is barely a response at all.”

    Hey! Look over there!

  10. Well, look, now we’ve tried the “free market” solution and it didn’t work. I mean, this is the big compromise the Republicans wanted, right? This was Mitt’s big solution in Massachusetts…and it failed. So now that the “free market” solution didn’t work it’s time to look at alternatives like single payer.

    I expect to hear stuff like this in the next year or so.

    1. Been hearing it for quite a while already.

      I wonder if this will end up being the Republican version of the “reproductive rights” threat, beaten like a rented mule in every close election for the next 20 years — “if Democrats ever get complete control again, you WILL get single payer”.

    2. I think single-payer was their plan all along, but first they had to blow up the existing system. They assumed once that was out of the way people would be more willing to go along with the only thing left, government run health care. Which will of course be “free.”

  11. as was the case before the Affordable Care Act, private insurance companies operate in a free market

    1) Did this shitheel say this with a straight face?

    2) Is this shitheel actually Schriek?

    3) Am I paranoid or does anyone else get the feeling that this is the first dose of “ZOMG MARKET FAILYURE!!11!1!!!!! BRING ON SINGUL PAYERZ!11!!!!!!!11!!” that will surely become the go to talking point as the law continues to fail?

  12. Of course the standard liberal talking point is going ot be “those were junk plans”. Because obviously any plan that doesn’t cover substance abuse treatment or pediatric dental care is “junk”.

  13. Cancellations are certain to be just the tip of the “Affordable Care Act” medical care mass implosion. Medical practice is rife with malpractice and as we descend into socialized Obamacare the proportion of malpractice to practice is only bound to inflate explosively. It’s a key point the “entitled” classes never consider while bawling for their “free” medical care. They bawl for their “free” Obamacare today. Tomorrow they will bawl about their victimhood to malpractice. Of course, they’ll demand to be compensated with $millions. And medical care will further shrink as the result until there’s none for anyone.

  14. Something these things always miss, anyone over I think 30 who was paying out of pocket for routine care and only had a catastrophic policy lost their plan last year unless they applied for and received a federal waiver. This year I don’t believe waivers will be handed out at all, so those who received the waiver will also lose their policy. Catastrophic policies are now illegal unless you’re young, because we all know that single men over 30 really really need a policy that covers pregnancy and free condoms (for a few thousand dollars a year).

  15. There’s always going to be a shakeup in a major change. My son for example will lose his company plan which caps out at $10,000 per year with a $5000 deductible because it doesn’t meet the ACA guidelines… And then there’s this news from last week:

    Number of Obamacare insurers to rise by 25% in 2015 http://www.cnbc.com/id/102025396#.

    More insurers line up to sell Obamacare plans in 2015, HHS says – The Washington Post http://www.washingtonpost.com/…..-hhs-says/

    Competition is good right? It’s what everyone has been pushing for decades..and now here it is.

    1. Who is “everyone” and what country do they live in? Here in the USA there certainly seems to be large a majority in the political and vocal classes who very much favor crony capitalism and/or socialism, neither of which offer anything even remotely resembling competitiveness.

    2. Government is currently backstopping any potential insurance losses, so insurers are on board and trying to gain market share while there is no downside. As soon as this incentive is removed, carriers will raise rates or get out of the program.

  16. “Free market ” my ass. My policy was cancelled in the first round of ACA. I kind of lucked out by having a birthday on Dec 31 – the day my policy was cancelled. I turned 65 and got on MediCare. Had I tried to keep my insurance company, I would have been paying 83% more each month. ACA REQUIRES MORE COVERAGE. All states have been mandating specifics of coverage for years, but this ACA crap is unavoidable in any state. I would be covered for OBGYN visits as a 65 year old male. WTF. Obama sucks. Congress( Democrats) suck bigtime on this one.

  17. First of all, one classic problem with how democrats approach things is the idea that you can make a change in one isolated place and everything you didn’t identify as a problem will hold still and remain the same. In the real world, you have something called the Law of Unintended Consequences.

    Second, for the past 60 Years both democrats and republicans alike have tried unsuccessfully to fix the health insurance industry. If the management of the insurance companies wanted things fixed, they would have done so without any laws being passed. You can expect that any point where a choice is made, the most common response is the one that is the most uncooperative and unhelpful.

    People certainly could criticize Obama and the democrats for the occasions where you picture him gaping in surprise and saying to some advisor “we didn’t tell them to do that” but the biggest obstacle to fixing things is shown in the comments on this site: the fact that some people foam at the mouth like rabid dogs whenever they see anything associated with democrats Especially if one gets elected to the presidency

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