Smoking gun: The Obama administration has admitted that 'in many cases,' insurance policies offered through Obamacare cost more than consumers' previous plans, even when they get federal government subsidies
By
David Martosko, U.s. Political Editor
The Obama administration has directly
conceded for the first time that 'in many cases,' health insurance
plans offered through government exchanges are more expensive than plans
consumers bought before the Affordable Care Act became law – even when
government subsidies are figured in.
In
a letter to state insurance commissioners, Center for Consumer
Information and Insurance Oversight director Gary Cohen wrote on
Thursday that one reason for the new Obamacare measures the president
announced Thursday is that millions of consumers receiving cancellation
letters from their insurers are learning the Affordable Care Act options
are in fact less affordable.
'Although
affected individuals and small businesses may access quality health
insurance coverage through the new Health Insurance Marketplaces,' Cohen
wrote, 'in many cases with federal subsidies, some of them are finding
that such coverage would be more expensive than their current coverage,
and thus they may [be] dissuaded from immediately transitioning to such
coverage.'
His written
statement contradicts President Obama's campaign promises that the
Affordable Care Act would lower costs for Americans.
In
October of that year he said during a campaign rally in Columbus, Ohio
that 'we are going to work with you to lower your premiums by $2,500. We
will not wait 20 years from now to do it, or 10 years from now to do
it. We will do it by the end of my first term as president.'
While Obama announced changes to his signature
health care overhaul law on Thursday, his chief insurance oversight
deputy was telling state officials that costs on the Obamacare website
will often by higher than consumers are used to
Cohen's letter also
goes further than the words Obama used Thursday to hedge his bets while
he outlined a new strategy to allow Americans to keep policies that
their insurers have already canceled.
'My
working assumption was that the majority of those folks would find
better policies at lower cost or the same cost in the marketplaces,' he
said.
'We will continue
to make the case, even to folks who choose to keep their own plans,'
Obama promised minutes later, 'that they should shop around in the new
marketplace because there’s a good chance that they’ll be able to buy
better insurance at lower cost.'
That
'good chance' of cost savings is a weaker standard than the White House
has employed before with messaging that promised no insurance price
hikes to 'most people.'
Center for Consumer Information and Insurance
Oversight director Gary Cohen let the cat out of the bag, writing that
for 'many' consumers, Obamacare plans 'would be more expensive than
their current coverage'
On Nov. 4 the president told a
partisan crowd of Obamacare supporters in Washington, D.C. that
'because of the competition between insurers' buily into the Affordable
Care Act, 'and the new health care tax credits, most people will be able
to buy better plans for the same price or even cheaper than what
they’ve gotten before.
Cohen's office is a subagency of the Centers for Medicare and Medicaid Services, the Health and Human Services Department agency in charge of implementing the failed healthcare.gov website that has made Obamacare's rollout a cringe-inducing national embarrassment.
Cohen's office is a subagency of the Centers for Medicare and Medicaid Services, the Health and Human Services Department agency in charge of implementing the failed healthcare.gov website that has made Obamacare's rollout a cringe-inducing national embarrassment.
His
letter also sets the terms of Obama's new policy shifts, outlining a
rule that would only apply to insurance policies in place by October 1.
Savings THIS big: Health and Human Services
Secretary Kathleen Sebelius, a former Kansas governor and insurance
commissioner, has been Obama's most visible public Obamacare defender,
but she will face new questions about consumer choice and insurance
price tags
Timeframe: If you like your plan, you can keep it, unless you bought it since October 1, 2013
'The transitional relief afforded in this document is not applicable to newly obtained health insurance coverage,' he wrote.
'It applies only with respect to individuals and small businesses with coverage that was in effect on October 1, 2013.'
Insurers
may balk at the president's latest set of requirements. His new 'fix'
to Obamacare would require companies to write to each cancelled
policyholder, outlining their options including the new exchanges.
An
insurance industry executive who requested anonymity told MailOnline
that the cost of complying will reach tens of millions of dollars.
'If
we cancelled a half-million [people],' the executive said,' now we have
to spent money researching every policy to see what to do, then send a
half-million letters in the mail? Good lord.'
The president of the health insurance
industry's largest trade group warned Thursday that Obama's new plan 'could destabilize the market and result in higher
premiums for consumers.'
'Premiums
have already been set for next year based on an assumption of when
consumers will be transitioning to the new marketplace," according to
Karen Ignagni, the president of America's Health Insurance Plans.
'If
now fewer younger and healthier people choose to purchase coverage in
the exchange, premiums will increase and there will be fewer choices for
consumers.'
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