House GOP getting its say on cancellations

By David Espo

Associated Press

Published: Friday, Nov. 15 2013 10:00 a.m. MST

His remarks on Wednesday marked a reversal with his personal and political credibility on the line, even though the impact on consumers is unclear.

Obama's approval ratings in polls are also ebbing, and he readily conceded that after recent events the public can legitimately "expect me to have to win back some credibility on this health care law in particular and on a whole range of these issues in general."

Shortly after Obama spoke, the major industry trade group, America's Health Insurance Plans, warned in a statement that prices might rise as a result of his new policy. "Changing the rules after health plans have already met the requirements of the law could destabilize the market and result in higher premiums for consumers," it said.

A few hours later, the head of the National Association of Insurance Commissioners added a fresh word of caution. Louisiana Insurance Commissioner Jim Donelon, president of the group, said Obama's proposal could lead to higher premiums and market disruptions next year and beyond.

"In addition, it is unclear how, as a practical matter, the changes proposed today by the president can be put into effect. In many states, cancellation notices have already gone out to policyholders, and rates and plans have already been approved for 2014," he added.

Until the president made his announcement, the administration had been assuming that individuals currently covered by plans marked for cancellation would switch to alternatives offered in government-established exchanges. If so, they would be joining millions of others who have lacked insurance in the past.

The people with current individual coverage are a known risk to insurers. But those without generally have had less access to medical services and are most costly to care for. The theory has been that moving people with current coverage into the new markets would help stabilize premiums.

Only last week, Health and Human Services Secretary Kathleen Sebelius told a Senate panel she doubted that retroactively permitting insurers to sell canceled policies after all "can work very well since companies are now in the market with an array of new plans. Many have actually added consumer protections in the last 3 1/2 years."

Associated Press writers Ricardo Alonso-Zaldivar, Donna Cassata, Julie Pace and Alan Fram contributed to this report.

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