Medicare Chief: Obamacare Isn’t Responsible for Insurance Plan Cancellations

CMS Administrator Marilyn Tavenner says it was going on long before the Affordable Care Act.

Centers for Medicare and Medicaid Services Administrator Marilyn Tavenner prepares to testify before the House Ways and Means Committee.
National Journal
Sophie Novack
Oct. 29, 2013, 7:39 a.m.

Cen­ters for Medi­care and Medi­caid Ser­vices ad­min­is­trat­or Mar­ilyn Taven­ner de­fen­ded Pres­id­ent Obama’s re­peated claim that “if you like your plan, you can keep it” un­der the Af­ford­able Care Act in a House Ways and Means hear­ing Tues­day.

The claim has been at­tacked re­cently, as many people con­tin­ue to re­ceive can­cel­la­tion no­tices from their in­sur­ance com­pan­ies. But Taven­ner ar­gues this was go­ing on be­fore the Af­ford­able Care Act.

“Half of the people in the in­di­vidu­al mar­ket pri­or to 2010 didn’t stay on their policies,” she said. “They were either kicked off for pre-ex­ist­ing con­di­tions, they saw their premi­ums go up at least 20 per­cent a year, and there were no pro­tec­tions for them. And some­times they were in plans that they thought were fine un­til they ac­tu­ally needed to hos­pit­al­iz­a­tion, and they found out it didn’t cov­er hos­pit­al­iz­a­tion or it didn’t cov­er can­cer.”

The health care law says that any in­sur­ance plans already in ef­fect as of March 23, 2010 are “grand­fathered” un­der the law. Con­sumers can keep those plans without pen­alty, even if they don’t meet all the new ACA re­quire­ments, un­less the in­sur­ance com­pany sig­ni­fic­antly changes part of the plan.

Taven­ner says some can­cel­la­tions are oc­cur­ring as a res­ult of com­pan­ies of­fer­ing new plans, which must then in­clude pro­tec­tions re­quired un­der the law. These in­clude many meas­ures, such as those that pre­vent dis­crim­in­a­tion based on pre-ex­ist­ing con­di­tions or on gender.

Taven­ner also main­tained that premi­um in­creases were oc­cur­ring long be­fore Obama­care. “In fact, we’ve seen the most premi­um mod­er­a­tion in the last three years than we’ve seen prob­ably in 15 or 20,” she said.

“So what I would tell [in­di­vidu­als] is if their car­ri­er is telling them they’re chan­ging the plan and they’re of­fer­ing an in­crease … they would need to go take a look at what’s avail­able in their state and in their mar­ket, which is cer­tainly something that’s avail­able to them through the ex­change.”

The hear­ing, which fol­lows the prob­lem-plagued rol­lout of the Obama­care web­site, saw Re­pub­lic­ans fiercely at­tack­ing the law and Demo­crats fight­ing to de­fend it, with law­makers of­ten talk­ing more than Taven­ner her­self. Her ap­pear­ance will set the table for a hear­ing Wed­nes­day in which Health and Hu­man Ser­vices Sec­ret­ary Kath­leen Se­beli­us will come be­fore Con­gress.

{{ BIZOBJ (video: 4533) }}

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