In an 11th-hour exemption change to the law, the Obama administration announced a major ObamaCare exemption that will let people who lost coverage and are still struggling to get a new plan sign up for bare-bones policies which is drawing immediate criticism from the Insurance industry and Republican lawmakers.
The insurance industry is criticizing the move late Thursday evening, which allows “catastrophic” coverage plans, as a shift that would cause “tremendous instability.”
The administration downplayed the sudden change, saying they expected it to impact fewer than 500,000 people. Health and Human Services spokeswoman Joanne Peters said, “This is a common sense clarification of the law. For the limited number of consumers whose plans have been cancelled and are seeking coverage, this is one more option.” An administration official confirmed that Health and Human Services Secretary Kathleen Sebelius sent a letter to Capitol Hill saying the administration was expanding the definition of catastrophic plans to deal with people who have not been able to get a new plan.
An insurance industry official, who wished not to be identified,said that while the administration was playing down the significance of the move, it could turn out to be a troublesome last-minute change and the industry fears far more than 500,000 people will apply. Another official, Robert Zirkelbach AHIP Spokesman Vice President, Strategic Communications, said, “This type of last-minute change will cause tremendous instability in the marketplace and lead to further confusion and disruption for consumers.”
Meanwhile, Democrats praised the steps as a common-sense backup in a difficult situation while Republicans called the administration action as another patch to an unworkable law.
House Energy and Commerce Committee Vice Chairman Marsha Blackburn, R-Tenn., described the move as “another major policy shift” from the Obama administration.”We asked Secretary Sebelius point-blank what would be the next holiday surprise, and she was silent. Yet, here we are with another major policy shift. The sad reality is that when the law takes effect come January 1, more Americans will be without coverage under Obamacare than one year ago,” Blackburn said in a statement she released Thursday evening. “Less than two weeks from going live, the White House seems to be in full panic mode. Rather than more White House delays, waivers, and exemptions, the administration should provide all Americans relief from its failed law.”
Obama was widely criticized for reneging on his promises that if you liked your plan, you could keep your plan under his health care law. He single-handedly later changed the law again and said insurers could extend those plans for one more year. Most state regulators followed Obama’s lead and gave insurance companies the additional latitude, but it’s unclear whether the problem has been resolved. Insurers are concerned that healthy customers who potentially would have bought full coverage may now stay out of the market, leaving the companies with a group of patients in worse health overall.
At the time of this posting, I have been unable to determine if the new law for the new catastrophic insurance policies will include ‘previous existing conditions’ or not but I’ll continue to try to research that and let you know.
