Topics: Obamacare

Senate Democrats wary of Obamacare fix while insurers warn of market destabilization

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Politics,Congress,Susan Ferrechio,Obamacare,Senate,Democratic Party,John Boehner,Health Care,PennAve,,Mary Landrieu

Senate Democrats were huddling privately Thursday with White House Chief of Staff Dennis McDonough after President Obama announced a "fix" for his new health care law that would allow insurance companies to renew millions of health insurance plans they canceled as part of their implementation of Obamacare.

"It's a step in the right direction," Sen. Mary Landrieu, D-La., said as she entered the meeting.

Landrieu issued a statement earlier pledging to push ahead with legislation that would allow the renewal of those canceled plans despite Obama's proposal, which is similar to Landrieu's plan except that it does not guarantee that those who lost their coverage can get it back.

Obama and Democrats had repeatedly assured people that they could keep their current insurance when Obamacare began on Oct. 1. But millions had their policies canceled because the plans did not meet Obamacare's stricter standards.

Some Senate Democrats said Obama's plan to undo the damage does not go far enough and should be extended for two years, not one.

Republicans, meanwhile, ripped Obama's proposal and called it an attempt to make it appear insurance companies are to blame for the cancellations, since insurers would ultimately have to decide whether to contact those with cancelled plans and offer those same policies again.

"The president has absolutely no credibility on his promise," House Speaker John Boehner, R-Ohio, said. "True to form, it appears this is little more than a political response designed to shift blame rather than solve the problem."

The insurance industry, which canceled millions of existing plans because they did not provide the minimum coverage Obamacare demands, also is unhappy with Obama's plan.

America’s Health Insurance Plans President and CEO Karen Ignagni said Obama's proposal could destabilize the entire insurance market and raise premiums.

"Premiums have already been set for next year based on an assumption of when consumers will be transitioning to the new marketplace," Ignagni said. "If now fewer younger and healthier people choose to purchase coverage in the exchange, premiums will increase and there will be fewer choices for consumers. Additional steps must be taken to stabilize the marketplace and mitigate the adverse impact on consumers.”

House Democrats praised the plan. Rep. Debbie Wasserman Schultz, D-Fla., who also heads the Democratic National Committee, called Obama's proposal "straightforward and fair," saying it would give consumers "additional choices."

Congressional Democrats and the White House said Thursday that they would continue to resist Republican efforts to dismantle the health care law.

The administration believes a House bill up for a vote Friday would destroy the law by allowing the cancelled individual insurance plans to be re-offered not only to the old policy holders, but new ones as well.

"While Democrats are committed to addressing challenges and ensuring that the law works, Republicans remain committed to repealing and gutting the law, regardless of its consequences," Wasserman Schultz said.

Mike Tanner, a health care policy scholar at the libertarian Cato Institute, said giving insurers the option of reissuing some plans could drive them to enroll only the most desirable customers, namely the young and healthy who might otherwise join the exchanges.

"You are going to drive premiums up," Tanner said.

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