“O, what a tangled web we weave, when first we practice to deceive.” – Sir Walter Scott
American Presidents sometimes utter memorable phrases that come back to bite them. Richard Nixon’s was this: “I am not a crook.” (This trumped his statement to the press after his 1962 defeat for Governor of California: “You don’t have Nixon to kick around any more.”)
George H. W. Bush’s was this: “Read my lips. No new taxes.” Then he raised taxes.
Bill Clinton’s was this: “I did not have sex with that woman, Miss Lewinsky.”
Barack Obama’s is probably going to turn out to be this: “If you like your healthcare plan, you can keep your plan.” He said this repeatedly. Here is a video with selections of this promise.
A story has hit the news media. The President knew that this would not be the case from the very beginning. Millions of Americans have received or will receive “Dear John” letters from their insurance companies: they will lose their coverage. In short: “Go fish.”
But where will they fish? The www.Healthcare.gov site does not work.
For most of those shoppers who find a policy, premiums will be higher.
Here was the lead paragraph for NBC’s version of the story of the “keep your plan” story.
President Obama repeatedly assured Americans that after the Affordable Care Act became law, people who liked their health insurance would be able to keep it. But millions of Americans are getting or are about to get cancellation letters for their health insurance under Obamacare, say experts, and the Obama administration has known that for at least three years.
That puts it starkly. But is this really true? The story continues.
Four sources deeply involved in the Affordable Care Act tell NBC News that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”
So, the policies will cost more. The President has promised subsidies to reduce the cost of premiums for most Americans, paid for by the taxpayers. But it turns out that this subsidy is not in the law as written, at least not for anyone buying health insurance from the federal government’s program, only the states’ exchanges. A federal judge will now decide whether the federal government can legally offer such subsidies. Fear will now spread. “What if he says that there will be no subsidies?”
This raises these two questions: “What did the President know, and when did he know it?” That was Senator Howard Baker’s repeated question during the Watergate hearings. The answer — on audiotape — eventually brought down Nixon.
What did Obama know, and when did he know it?
None of this should come as a shock to the Obama administration. The law states that policies in effect as of March 23, 2010 will be “grandfathered,” meaning consumers can keep those policies even though they don’t meet requirements of the new health care law. But the Department of Health and Human Services then wrote regulations that narrowed that provision, by saying that if any part of a policy was significantly changed since that date — the deductible, co-pay, or benefits, for example — the policy would not be grandfathered.
Buried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, “40 to 67 percent” of customers will not be able to keep their policy. And because many policies will have been changed since the key date, “the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range.”
That means the administration knew that more than 40 to 67 percent of those in the individual market would not be able to keep their plans, even if they liked them.
Millions of people will be hit.
“This says that when they made the promise, they knew half the people in this market outright couldn’t keep what they had and then they wrote the rules so that others couldn’t make it either,” said Robert Laszewski, of Health Policy and Strategy Associates, a consultant who works for health industry firms. Laszewski estimates that 80 percent of those in the individual market will not be able to keep their current policies and will have to buy insurance that meets requirements of the new law, which generally requires a richer package of benefits than most policies today.
The White House does not dispute that many in the individual market will lose their current coverage, but argues they will be offered better coverage in its place, and that many will get tax subsidies that would offset any increased costs.
But will they get these subsidies? That is for the federal courts to say, or maybe the Supreme Court.
President Obama will be remembered, above all, by what happens to ObamaCare. If the courts say “no subsidies for policies bought on the federal government’s list,” he will not be remembered fondly.