The Obama administration Thursday night abruptly decided to let people whose insurance was canceled under Obamacare buy bare-bones plans or even avoid the requirement that most Americans have health coverage, according to multiple news reports.
The surprise announcement came just four days before a Dec. 23 deadline for people to choose coverage that begins Jan. 1, the Washington Post reported
— and set off howls of protest from the health-insurance industry.
“This type of last-minute change will cause tremendous instability in the marketplace and lead to further confusion and disruption for consumers,” Robert Zirkelbach, spokesman for American’s Health Insurance Plans, told The Post.
But the administration said it was only fair.
“This is a common sense clarification of the law,” said Joanne Peters, a spokeswoman for the Department of Health and Human Services (HHS). “For the limited number of consumers whose plans have been canceled and are seeking coverage, this is one more option.”
The policy shift was laid out in a letter to Sens. Mark Warner, D-Va., Jeanne Shaheen, D-N.H., Mary Landrieu, D-La., Heidi Heitkamp, D-N.D., and Tim Kaine, D-Va., who asked the administration on Wednesday to clarify whether those who had their plans canceled could qualify for the exemption, The Hill reported
The Washington Post noted the lawmakers faced tough re-election campaigns next year, or were from states that President Barack Obama lost in last year’s election.
The New York Times reported
HHS issued a bulletin advising consumers: “If you have been notified that your individual market policy will not be renewed, you will be eligible for a hardship exemption and will be able to enroll in catastrophic coverage.”
In past weeks, insurers have been dropping the bomb on millions of Americans that their coverage was canceled because it didn't cut it with the new Obamacare requirements — and that they'd be stuck with bigger premiums for plans that did comply.
But after a flood of complaints the president had reneged on his promise that people could keep their plans, a humbled Obama apologized Nov. 7 and said insurance companies could continue for another year to offer health plans sold to individuals and small businesses that don't meet the new Obamacare standards.
Thursday night's change appeared to be squarely aimed at quelling the controversy over a promise so blatantly wrong it earned Obama a "Lie of the Year" award.
Sebelius said the goal of the new policy change was to ensure “the smoothest possible transition” for people seeking new coverage after the cancellation of their policies, The Times reported.
The Post and The Hill explained by allowing those with canceled policies to claim hardship exemptions, the Obama administration frees them from a requirement that most Americans must have health insurance or risk a fine — and to buy “catastrophic” or bare-bones coverage.
That used to be allowed only to people under 30.
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