Obama: Individuals May Keep Cancelled Insurance Policies for Now

Obamacare established new standards for health insurance coverage in the U.S. As a result, millions of Americans were presented with policy cancellation notices, forcing many people to drop their current coverage and opt for a new health insurance plan. In order to help alleviate this troublesome situation, the president made an announcement yesterday that his administration would not enforce the Obamacare provisions that led to policy cancellations throughout the country.

Therefore, individuals who were in favor of their current coverage plans may be able to keep them for another year. However, once midterm elections are complete, plans that are not in accordance with the new healthcare law will get canceled again.

The new transitional policy introduced by the administration will enable people who were happy with their insurance to remain on their current plans, as long as their policies were effective on Oct. 1 of this year. Furthermore, another stipulation for this newly-enacted policy is that insurers provide free advertisements for their competitors on Obamacare’s online exchanges.

Aside from the 25 million Americans who opt for their own coverage through the individual market, several employees covered by employer-based insurance will also encounter cancellations. Currently, 156 million people obtain healthcare through their employers.

In addition to this particular provision, there are many other  aspects  of Obamacare that will not be enforced yet, such as postponing the employer mandate for a year. These and other unilateral actions are being announced by the White House, since the administration wants to avoid the potential for Congress to pass legislative amendments to the new healthcare law.

In order for this cancellation fix to actually work, insurers must find some way to rush their old products into the marketplace by January 2014. This will be extremely difficult for insurers to pull off. Since new reimbursement rates for 2014 would have to be negotiated with doctors and hospitals, insurers would have to submit these plans to state insurance regulators in order to obtain approval.

Despite the proposed cancelation fix, a new Gallup poll released this week revealed an increase in disapproval rates for the Affordable Care Act, rising from 47 percent to a high of 55 percent. Additionally, the president’s overall approval ratings have fallen between the high 30s and 40s.

Even with the change, the administration is leaving it up to each individual state to determine whether or not residents can keep coverage plans that are not in accordance with the new healthcare initiative. As a result, state insurance commissioners, along with other health policy experts, have established the fact that insurance plans will greatly vary across the country.

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