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.