Media Surprised By Obamacare's Effect On Insurance Coverage Admin Explained Years Ago
Research ››› ››› HANNAH GROCH-BEGLEY & MICHELLE LEUNG
Media reports suggested that it was previously unknown that some in the individual insurance market would have to seek new health care plans due to the Affordable Care Act's (ACA) regulations. In fact, the administration announced in 2010 that some insurance policies would not be "grandfathered" in under the new law, largely due to regular turnover in the health insurance marketplace.
Media Reports Claim Fact That Some Insurance Plans Will Change Under The ACA Was "Unexpected" And Hidden By Obama Administration
NBC: Grandfather Clause "Buried In Obamacare Regulations." NBC's Lisa Myers and Hannah Rappleye misleadingly reported that Obama did not previously disclose his knowledge that many consumers might not be able to keep their original health insurance plans, ignoring the fact that this was announced by his administration in 2010. From the NBC News Investigations blog:
Buried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, "40 to 67 percent" of customers will not be able to keep their policy. And because many policies will have been changed since the key date, "the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range."
That means the administration knew that more than 40 to 67 percent of those in the individual market would not be able to keep their plans, even if they liked them.
Yet President Obama, who had promised in 2009, "if you like your health plan, you will be able to keep your health plan," was still saying in 2012, "If [you] already have health insurance, you will keep your health insurance." [NBC News, 10/29/13]
USA Today Echoed Misleading NBC Report To Imply Obama Lied About Individuals Keeping Their Health Insurance. An October 29 USA Today article hyped the misleading NBC report, claiming that the White House knew insurance plans would be canceled under the ACA, but does not include the important fact that this information was made public in 2010:
Millions of Americans are getting their health insurance canceled under the Affordable Care Act and the Obama administration has known for about three years that this would happen, NBC News is reporting.
NBC alleges the administration knew that up to 67% of customers on the individual market could have their policies canceled, but instead, President Obama said as recently as in 2012, "If (you) already have health insurance, you will keep your health insurance."
The White House told NBC that people whose policies will be canceled will, in most cases, be automatically shifted to plans with better protections. [USA Today, 10/29/13]
CNN's Ashleigh Banfield Claims The Administration "Didn't Saying Anything" About Some Policies Changing. CNN host Ashleigh Banfield played clips of Obama saying "if you like your health care plan, you can keep your health care plan," and responded by claiming that the administration "didn't saying anything" to warn that health insurance policies might change. CNN correspondent Joe Johns corrected her, explaining that "this story's been around a long time." [CNN, Legal View with Ashleigh Banfield, 10/29/13]
Fox News' Steve Doocy: "Back In 2010, They Knew Millions Would Lose It And They Didn't Say A Word." On Fox & Friends, co-host Steve Doocy falsely claimed that the president had hid the fact that some individuals would experience changes to their insurance coverage under the Affordable Care Act, saying "So you've seen the president and a number of Democrats, high ranking officials say, if you like your insurance, you can keep it -- back in 2010, they knew millions would lose it, and they didn't say a word." [Fox News, Fox & Friends, 10/29/13, via Media Matters]
CBS News: Changes To Insurance Plans "An Unexpected Reality." CBS News reported that the fact some individuals would have policies change under the law was "an unexpected reality of Obamacare":
There have been estimates about hundreds of thousands of people losing coverage, CBS News' Jan Crawford reported on "CBS This Morning." CBS News has reached out to insurance companies across the country to determine some of the real numbers -- and this is just the tip of the iceberg, Crawford said. The people who are opening the letters are shocked to learn they can't keep their insurance policies despite President Obama's assurances to the contrary.
The White House is on the defensive trying to explain it, after Mr. Obama repeatedly said, "If you like your doctor or health care plan, you can keep it."
White House Press Secretary Jay Carney said, "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."
It's an unexpected reality of Obamacare being told through anecdotes in local papers and on social media. But the hard numbers reveal the evidence is far more than anecdotal. CBS News has confirmed with insurance companies across the country that more than two million people are getting notices they no longer can keep their existing plans. [CBS News, 10/29/13]
Wash. Times: White House "Acknowledged For the First Time Monday" That Some Consumers Will Need To Switch Plans. The Washington Times claimed that the "White House acknowledged for the first time Monday that President Obama's oft-repeated promise that everyone can keep their health insurance plans under Obamacare just isn't true." [The Washington Times, 10/29/13]
Administration Acknowledged Some Plans Would Change In 2010
HHS Press Release, June 2010: "Roughly 42 Million People Insured Through Small Businesses Will Likely Transition From Their Current Plan." A June 2010 press release from the Department of Health and Human Services explicitly stated that some individuals would face changes to their plans, stating "roughly 42 million people insured through small businesses will likely transition from their current plan to one with the new Affordable Care Act protections over the next few years" and that the 17 million "who are covered in the individual health insurance market, where switching of plans and substantial changes in coverage are common, will receive the new protections of the Affordable Care Act." The release further noted that when a plan is not grandfathered in, individuals would still be eligible for the same basic health insurance minimums:
Roughly 40 percent to two-thirds of people in individual market policies normally change plans within a year. In the short run, individuals whose plan changes and is no longer grandfathered will gain access to free preventive services, protections against restricted annual limits, and patient protections such as improved access to emergency rooms. [U.S. Department of Health and Human Services, 6/14/10]
Sec. Sebelius, June 2010: If Health Plans Significantly Change, "They Lose Their Grandfather Status." On June 14, 2010, Health and Human Services Secretary Kathleen Sebelius announced the administration's grandfathering regulations, saying "if health plans significantly raise copayments or deductibles, or significantly reduce benefits, for example just stop covering treatments like HIV/AIDS or cystic fibrosis, they lose their grandfather status." [U.S. Department of Health and Human Services, 6/14/10]
Interim Final Rule On ACA, June 2010: Administration Estimates Some Plans Will Not Be Grandfathered Due To Regular Turnover In Insurance Markets. The interim final rule published in the Federal Register in June 2010 about the grandfathering rules cited research that showed the individual insurance market regularly saw heavy turnover each year, and that the administration's estimate of the amount of plans that would not be grandfathered was based on the regular turnover rate:
The market for individual insurance is significantly different than that for group coverage. This affects estimates of the proportion of plans that will remain grandfathered until 2014. As mentioned previously, the individual market is a residual market for those who need insurance but do not have group coverage available and do not qualify for public coverage. For many, the market is transitional, providing a bridge between other types of coverage. One study found a high percentage of individual insurance policies began and ended with employer-sponsored coverage. More importantly, coverage on particular policies tends to be for short periods of time. Reliable data are scant, but a variety of studies indicate that between 40 percent and 67 percent of policies are in effect for less than one year. Although data on changes in benefit packages comparable to that for the group market is not readily available, the high turnover rates described here would dominate benefit changes as the chief source of changes in grandfather status. While a substantial fraction of individual policies are in force for less than one year, a small group of individuals maintain their policies over longer time periods. One study found that 17 percent of individuals maintained their policies for more than two years, while another found that nearly 30 percent maintained policies for more than three years. Using these turnover estimates, a reasonable range for the percentage of individual policies that would terminate, and therefore relinquish their grandfather status, is 40 percent to 67 percent. These estimates assume that the policies that terminate are replaced by new individual policies, and that these new policies are not, by definition, grandfathered. [Federal Register, 6/17/10]
NY Times In 2010: Administration Acknowledged That Some "Might Face Significant Changes In The Terms Of Their Coverage." The New York Times reported in June 2010 that the administration acknowledged that some "might face significant changes in the terms of their coverage":
In issuing the rules, the administration said this was just one goal of the legislation, allowing people to "keep their current coverage if they like it." It acknowledged that some people, especially those who work at smaller businesses, might face significant changes in the terms of their coverage, and it said they should be able to "reap the benefits of additional consumer protections."
The law provides a partial exemption for certain health plans in existence on March 23, when Mr. Obama signed the legislation. Under this provision, known as a grandfather clause, plans can lose the exemption if they make significant changes in deductibles, co-payments or benefits.
About half of employer-sponsored health plans will see such changes by the end of 2013, the administration says in an economic analysis of the rules.
The rules allow employers and insurers to increase benefits. But, in a summary of the rules, the administration said, "Plans will lose their grandfather status if they choose to make significant changes that reduce benefits or increase costs to consumers." [The New York Times, 6/14/10]