President Obama announced Thursday an administrative change in one of the bedrock ideas of the new health-care law, allowing people with individual insurance policies to keep them for another year even if they do not comply with the law’s rules for minimum benefits.
“This fix won’t solve every problem for every person, but it’s going to help a lot of people,” Obama said in making the announcement. He said that “doing more” would require congressional action.
The White House, responding to intensifying pressure from disgruntled consumers and Congress, decided to make the fix as a part of a strategy to try to ward off more far-reaching changes that are being advocated on Capitol Hill. Under the White House’s approach, the Department of Health and Human Services will notify the nation’s state insurance commissioners that they have federal permission to allow consumers who already have such insurance policies to keep them through 2014. It will be up to each state whether to go along.
The decision runs counter to a central aim of the law, which was to ensure that all people in the United States with private health plans are guaranteed at least certain benefits.
Obama said the administration will insist that insurance companies continuing to sell individual insurance policies that do not comply with those standards alert consumers to potentially better and more affordable insurance available through the new federal and state insurance marketplaces.
The White House’s strategy differs from a bill on which the House is to vote on Friday, sponsored by Rep. Fred Upton (R-Mich.), which would let new customers buy such meager policies, rather than allowing only existing policy-holders to keep them for an additional year.
Under Obama’s change, insurance companies do not necessarily have to let consumers keep their individual plans that do not meet the new standards. Rather, states are given the option of allowing insurance companies to offer consumers the chance to keep their 2013 plans for another year.
Obama, facing a political furor over the cancellation of many Americans’ insurance plans purchased on the individual market, made announcement at the White House before embarking on a scheduled trip to Cleveland, where he planned to speak about the economy. He will then travel to Philadelphia to attend a fundraiser for the Democratic Senatorial Campaign Committee.
The Obama administration reported Wednesday that slightly more than 106,000 Americans signed up for health plans in the first month of new state and federal insurance marketplaces. The figure, which was far lower than the administration originally predicted, points to the steep challenge ahead as the White House tries to overcome public and congressional frustration with the program’s problem-plagued rollout.
The tally showed that just a quarter of the enrollments were in the federally run marketplace, while the rest were in the state exchanges.
Speaking to reporters before Obama’s announcement, House Speaker John A. Boehner (R-Ohio) said he doubted that an administrative fix would be possible.
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