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Topics: Obamacare

Obama administration again delays deadline for cancelled plans

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Politics,White House,Brian Hughes,Barack Obama,Obamacare,Health Care,2014 Elections,PennAve,Health Care Exchanges

The Obama administration announced Wednesday that it would allow insurers to issue until October 2016 health plans that do not meet Obamacare regulations, pushing back another Affordable Care Act deadline well past November's midterms.

Facing the prospect of another wave of cancellation notices this fall, the administration took even further action to mitigate the blowback from President Obama's broken promise that all Americans could keep their health care plans under Obamacare.

The Department of Health and Human Services had already given insurers the option of continuing those plans facing cancellation through 2014, and on Wednesday said those policies could remain in effect an additional two years.

For example, if an individual renewed their health plan on Oct. 1, 2016, their coverage would last into 2017.

“We’re extending this to give people an opportunity to make a judgment about what works best for them and their families,” a senior administration official said, briefing reporters on the major policy change.

Administration officials say the change was crafted in consultation with lawmakers, such as Sen. Mary Landrieu, D-La., and Jeanne Shaheen, D-N.H., both facing tough re-election fights in November.

Although the administration is framing the change as a way to boost flexibility for consumers and insurers, conservatives counter that the administration is unilaterally making decisions that should require legislative approval. And Republicans contend that the White House is trying to protect Democrats from political damage around November's midterms.

“This reeks of politics," said Brendan Buck, a spokesman for Speaker John Boehner, R-Ohio.

"Instead of working with Congress to prevent Americans from losing the plans they like and can afford, the president is unilaterally re-writing laws around the election calendar," he added. "You have to wonder if he’s more interested in keeping his promise or keeping seats in the Senate.”

Many Democrats, already on the defensive after the rocky rollout of the new insurance exchanges, feared that a wave of Americans losing their coverage could hurt them in the elections.

In addition to extending the deadline for cancelled plans, the administration is adjusting “risk corridors” meant to reimburse insurance companies if they are forced to pay more in medical claims than they projected.

“Because we believe that the effect of the transitional policy on the risk pool will be greater in states with higher enrollment in transitional plans, we will vary the state-specific percentage adjustment to the risk corridors formula based on the percentage enrollment in transitional plans within in a state,” HHS said in a memo explaining the shift.

Republicans have called the program a “bailout” for the insurance industry. But supporters say the measures were essential to bring insurers on board with Obamacare.

HHS also offered additional help for insurers by lowering the threshold for them to get reimbursed for costly policies. Previously, HHS would reimburse insurers for claims that ran over $60,000 in health costs, but on Wednesday lowered that to $45,000 for the 2014 benefit year.

The administration is trying to move past the botched rollout of healthcare.gov but continues to struggle to meet its own deadlines for central provisions of the law.

The administration earlier this month announced that it would give midsize employers until 2016 to provide health insurance for their workers, delaying the mandate for a second time.

Though the extension of cancelled plans moves the issue past the midterms, it could give Republicans ammunition against 2016 Democratic presidential candidates.

Administration officials said they were not planning to extend the March 31 deadline for individuals to obtain health insurance or pay a fine.

“No major changes are anticipated at this point,” the senior administration official said.

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