- Aaron Carroll: Obama's quick "fix" on insurance cancellations puts off needed changes
- He says ACA mandates adequate care; policies without it must go away
- He says "fix" just shifts blame to the insurance companies when they cancel policies
- Carroll: To fix broken health care, we must accept changes. There are no easy answers
The implementation of the Affordable Care Act is not going well. First, the volume of people showing up to HealthCare.gov on October 1 completely crashed the site. Then, it turned out the data being passed up and back was completely corrupt. Then, millions of Americans began discovering that plans they "liked" were being canceled, and they were being told it was because of the Affordable Care Act.
President Obama announced an administrative fix to this problem on Thursday: an extension that allows insurers to keep people on health care plans that the Affordable Health Care act would not have allowed.
The cancellations had posed a real problem for the Obama administration, because they flew in the face of what many believe is a core promise of health care reform: that you could keep your policy if you liked it. Millions are finding out this isn't true. Those of us who have been in the weeds of health policy have known this for a long time. Most Americans did not.
The Affordable Care Act changes the way insurance is regulated. It declares that many services are now mandatory. This included a lot of preventive care, as well as maternity care. Any policies that don't provide these services will no longer be offered. Other policies had very low annual or lifetime limits. These, too, have to go away. Anyone who had one will need to find a new policy. It's very likely that newer policies, with more robust benefits, will be more expensive.
That will make many people unhappy.
We can argue that the new policies are still a good deal, or that much of that cost will be defrayed by subsidies, or that future protections to both beneficiaries and their families are worth the added cost, but that's somewhat beside the point. Many people feel like they were told they could keep their insurance, and now they think they have been lied to.
Obama knows the law is in trouble. Many Democrats feel like they took hard votes and stuck their necks out to support the law, and now that there's a perception that the executive branch has dropped the ball, their support is not as strong. There are a number of bills and fixes being debated.
That won't be easy, though. That's in part because no insurance plan sticks around forever. Plans change from year to year, premiums change from year to year, coverage changes from year to year, and deductibles, copays, and co-insurance change from year to year. They always have. It has never been the case that you could be guaranteed that your plan would exist -- as it does today -- for as long as you would like. I've had plans I've liked canceled many times in my 10 years working at my current job.
One bill being put forth in the House would allow insurers to continue to offer plans that have been discontinued due to the Affordable Care Act. The problem with that is that many insurance companies don't want to continue to offer those plans indefinitely. They don't make sense financially. Therefore, passing this law won't stop millions of Americans from getting cancellation notices anyway.
A different bill in the Senate would force insurance companies to continue to offer those plans or leave the state entirely. If you thought the Affordable Care Act was a government takeover before, this bill is much, much worse. It would compel insurance companies to comply with a whole new host of potentially unprofitable regulations.
The truth of the matter is there is no easy solution here. Disrupting the current system isn't a bug of health care reform; it's a feature. It's what was supposed to happen. All reform will do so. Even Republican proposals, like Sen. John McCain's when he was running for president, to change the health insurance tax deduction, would have completely upended the employer-sponsored health insurance system. Then-Sen. Obama attacked him savagely for just that back in 2008.
It's fine for President Clinton and others to just "demand" this be fixed. Unfortunately, it can't be, at least not easily and not cheaply. Letting healthy people keep these plans (because most of those in the pre-Affordable Care Act individual market are healthier) and stay out of the exchanges will raise the premiums for everyone else, and thus the amount the government will have to pay in subsidies. Forcing insurance companies to continue to offer old plans in a new marketplace could wind up hurting their bottom line significantly.
Obama's administrative fix, much like the House bill, allow plans offered this year to remain in place if people want them. But that will just shift blame to the insurance companies when they cancel them. For many of the reasons above, they won't want to keep them going.
The real problem here, and one that few are addressing, is that the old health care system isn't that good. We wanted to change it. Doing so means that it, well, changes. If we liked our old health care system, we could keep it. But we didn't, and so at some point we're going to have to accept a new one.
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