Obamacare Is Junk Insurance

By David Freddoso

Millions of Americans' individual market health plans are being canceled because of President Obama's health care law.

Now embarrassed by his oft-repeated and false promise that “if you like your health plan you can keep it,” Obama has retreated to a new line of defense: Your old health plan had to be canceled because it was “junk.”

There are two problems with this new argument. The first is admittedly anecdotal: Where are the cancellation victims who now stand to pay less for more insurance – or even just the same amount for a better plan?

Yet there is no shortage of people who are finding they will now pay more for less coverage under Obamacare – higher deductibles, smaller provider networks, significantly higher premiums – and end up with little more than free birth control to show for it.

That's the second and more convincing reason to disbelieve the White House's new defense. If these millions of cancelled plans are “junk,” then why are so many of the Obamacare substitutes so vastly inferior and more expensive?

Obamacare is making Robert Laszewski, a respected health insurance expert, lose his top-notch insurance plan, with which he “can access every provider in the national Blue Cross network ... without higher deductibles and co-pays ... Wellness benefits are without a deductible. It covers mental health, drugs, maternity, anything I can think of.”

Obamacare offers Laszewski a plan that costs 66 percent more each month, severely restricts his doctor network, and carries a deductible $500 higher than his old plan. So tell me – which plan is “junk?”

Such stories abound. At the Daily Beast, David Frum describes in greater detail what he had earlier summed up in one tweet.

“I already had a high-deductible plan,” he wrote. “Now I can buy a plan with double the deductible for only $200 a month more.” (My own experience shopping the D.C. exchange produced results similar to Frum's.)

Washingtonian contributing editor Art Levine, an Obamacare supporter, wrote at the Huffington Post that he's losing his relatively expensive ($530 per month premium) but comprehensive plan.

A comparable Obamacare plan will cost him twice as much. “The spin being offered now is that the plans being canceled by and large don't cover mental health or reasonably-priced medications or maternity care,” he writes. “ But that's simply not true, as my plan's benefits indicate.”

L.A. Times guest blogger Matthew Fleischer is losing his “bare-bones” plan. Under Obamacare, he will pay 43 percent more each month for an even more bare-bones plan, with higher co-pays and an annual out-of pocket limit $1,450 higher.

As for the program's subsidies, Fleischer notes that even if he could get his income down to $30,000 (not much in California), he would receive only about $40 per month, leaving him still paying more – and getting less in return if he ever gets sick.

When Obama claims your old plan was “junk,” he's not leveling with you. Your health plan wasn't canceled out of some kind of concern that you are insufficiently insured. Rather, you simply must pay more – and get less – to make Obamacare's finances work.

Rather than prioritize federal or state government budgets to subsidize those with pre-existing conditions – treating them as the rare special cases they are – Obama chose to finance their care by making you pay more into the system and get less out of it whenever you eventually become sick. Someone out there is benefiting from Obamacare. It just isn't you.

Middle-income cancellation victims are the Affordable Care Act's first cash cow. Their insurance will now be less affordable and of lower quality - or to use the common phrase, “junk.”