Does ObamaCare let you “Keep Your Insurance,” and is it the Insurance Companies who are Taking it Away?

The answer to this apparently simple question is pretty hard to find, especially for folks who are not familiar with navigating the Federal laws and regulations surrounding health care.  It looks like the Obama Administration is  taking advantage of the complexity of these regulations to try to mask the impact that ObamaCare actually has on insurers so they can politick the issue.

But any fair examination of the ACA and the insurance industry response reveals a “cause and effect” relationship.  To blame the insurers for their current actions is to ignore the cause of those actions – ObamaCare and its regulations.  Betsey McCaughey has published a good piece on this subject at Investor’s Business Daily (http://news.investors.com/ibd-editorials-on-the-right/102913-677113-americans-duped-by-obamacare-promises.htm)

Looking at the Affordable Care Act (ObamaCare), the Preservation of Coverage Section [1251(a)(2)] states that

“With respect to a group health plan or health insurance coverage in which an individual was enrolled on the date of enactment of this Act, this subtitle and subtitle A … shall not apply to such plan or coverage,”

So we might think that these existing (“grandfathered”) individual and employer plans would not be affected by the new ObamaCare requirements, as the President has repeatedly stated.  Unfortunately, there are many other requirements in subtitles other than “A,” and their applicability to existing “grandfathered” plans is not at all clear in the Act.

One area that has been clarified by regulation, is the requirement for no cap on maximum lifetime benefits.  Since this requirement is contained in “subtitle A” of ObamaCare, we might think that “grandfathered” plans are exempt, as stated in the Preservation of Coverage clause quoted above.  That would be WRONG!  The regulations published on June 28, 2010, only five months after the Act was signed, contradict that section of the Act!

“The statute and these interim final regulations relating to the prohibition on lifetime limits generally apply to all group health plans and health insurance issuers offering group or individual health insurance coverage, whether or not the plan qualifies as a grandfathered health plan...”

So how much impact could this change have?  Right in the June 28, 2010 Federal Register is the following estimate for 2009:

“Sixty-three percent of large employers had lifetime limits; 52 percent of small employers had lifetime limits and 89 percent of individual market plans had lifetime limits.”

So it’s easy to see, as long ago as June, 2010, that, going forward,  tens of millions of people might be affected.  In general terms, eliminating these lifetime limits would be expected to cause increases in  premiums, copays, and deductibles to offset the risk, and these are exactly the kinds of changes to coverage that we are now seeing throughout the Country.

I find it hard to believe that even this sloppy Administration is ignorant of the information published in its own Federal Register notices. I think they are misleading the Public by claiming they didn’t realize the current increases would occur, and they are in bad faith by blaming the insurance companies, when those companies are just reacting as predicted by the Administration.

Additionally, any corporation counsel worth half his salary, would be alarmed by the fact that when the regulations are published they can conflict with the Act as to what is actually required of “grandfathered” plans.   This casts a shadow over the true, unwritten, legal intent of many of the other ObamaCare requirements.  How do insurers know that they will not be in violation next week or next month as new regulations and interpretations are issued?

In my opinion, this uncertainty is a big factor in the insurance companies’ decisions to just give up offering the old policies.

When is America finally going to wake up and figure out that beating up on the insurance companies is pure propaganda to cover up the intentions and impact of a bad law on a good health care system?

Come back and I will try truthin’ you again.  Maybe some of it will eventually stick.

The Sceptic

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