Obama Breaks Promise As Many Lose Health Coverage
Policy + Politics

Obama Breaks Promise As Many Lose Health Coverage

REUTERS/Alex Gallardo

The news that more than half a million Americans from California to Florida are being dropped from their private health insurance plans and forced to purchase new policies through the Affordable Care Act has greatly added to President Obama’s credibility problems in defending his beleaguered and technologically challenged health insurance program.

Since the enactment of the 2010 health care legislation, the president repeatedly has promised that Americans who were happy with their current health insurance plans could keep them. But Kaiser Health News reported last week that insurers have sent notices to hundreds of thousands of people with private plans that their coverage is being terminated at the end of the year because it doesn’t meet the new, higher standards set under the Affordable Care Act.


“Florida Blue, for example, is terminating about 300,000 policies, about 80 percent of its individual policies in the state,” according to Kaiser Health News. “Kaiser Permanente in California has sent notices to 160,000 people – about half of its individual business in the state. Insurer Highmark in Pittsburgh is dropping about 20 percent of its individual market customers, while Independence Blue Cross, the major insurer in Philadelphia, is dropping about 45 percent” of its policy holders.

Over the weekend, Florida Blue’s chief executive, Patrick J. Geraghty, defended his company’s action, noting that people being dropped from coverage will be able to enroll in a better plan under Obamacare – and that in many cases they’ll qualify for a federal tax subsidy that will bring their costs down further. “We’re not cutting people – we’re transitioning these people,” Geraghty told David Gregory, host of NBC’s “Meet the Press.”

But what about Obama’s oft-stated pledge: “If you like your insurance plan, you will keep it. No one will be able to take that away from you”? That seemed a bedrock promise to Americans as the president sought to counter stiff Republican opposition to his health reform measure. 

The deeply flawed  government website and troubled rollout of the program has prompted an uproar on Capitol Hill and sparked GOP calls for the resignation of Health and Human Services Secretary Kathleen Sebelius. But Republicans and even some Democratic critics argue that the technical problems  actually pale in comparison to more fundamental concerns about the program and the way it was unveiled that  are just now coming to light.

Lawmakers are irked that they were told repeatedly over the summer and just days before the Oct. 1 launch that Healthcare.gov would be ready to handle a crush of applicants,  when in fact it was never adequately tested before the catastrophic unveiling. But they’re evenmore concerned that  premium costs in many states will be much higher  than the president and his top advisers promised.

“The president made promises that this was going to be cheaper than your cell phone bill, easier to use than Amazon and you can keep your doctor,” Sen. John Barrasso (R-WY), a member of the Senate GOP leadership, told George Stephanopoulos on ABC’s “This Week” program. “People all across the country are seeing that’s just not true.”


Indeed, the administration promised that insurance premiums generally would come down, especially for low-income families and individuals who qualify for government tax subsidies. Candidate Obama pledged on June 5, 2008: “In an Obama administration, we'll lower premiums by up to $2,500 for a typical family per year... We'll do it by the end of my first term as president of the United States."

The reality is much different – and more complicated. Premiums will in fact be a mixed bag. They will vary from state to state and be based on the applicant’s age and family size. Residents of California, Ohio, Florida and elsewhere reportedly are experiencing sticker shock over skyrocketing premiums. New York and a handful of other states will see individual premiums plummet, however. 

Subsidy levels will vary based on income, family size and local premiums. A study by the Kaiser Family Foundation in September concluded that while premiums will vary significantly across the country, generally they’ll be lower than the latest projections from the Congressional Budget Office. Another analysis by the conservative Heritage Foundation concluded that individuals in most states would end up spending more on insurance in the new exchanges, though the analysis didn’t factor in the impact of the subsidies for lower-income people.