The White House said Thursday that far fewer people than critics projected had lost their insurance plans and failed to get new coverage since the rollout of the Affordable Care Act, also known as Obamacare.
The Obama administration also said it would allow those Americans who had their individual insurance policies canceled due to Obamacare to buy catastrophic coverage, as an option so they do not fall through the cracks at the start of the year.
“This is a commonsense clarification of the law. For the limited number of consumers whose plans have been cancelled and are seeking coverage, this is one more option,” Health and Human Services spokesperson Joanne Peters told CNN.
HHS said it believes most people impacted would have better options but would be given an alternative through a hardship exemption if they believe their choices in the marketplace are more expensive than their canceled plan.
After the administration announced the catastrophic coverage option, reactions poured in from the right and left.
“We are pleased that the administration appears to have responded to the concerns we’ve raised,” a group of five Senate Democrats and one independent said in in a statement.
Earlier in the day, Sens. Mark Warner, Jeanne Shaheen, Mary Landrieu, Heidi Heitkamp and Tim Kaine along with independent Angus King sent a letter to Health and Human Services Secretary Kathleen Sebelius, advocating the change. All are more moderate members of the left from right-leaning states, and many face tough re-elections next November.
“As a result, this clarifies an option that will help those consumers who have had their plans canceled transition more smoothly into the marketplace. We will closely monitor how the administration implements this option, and we remain committed to proposing responsible solutions,” the statement said.
Senate Republicans took a harder line.
“Holding a fire sale of cheap insurance is not a responsible fix for a broken program. This is a slap in the face to the thousands of Americans who have already purchased expensive insurance through the Obamacare exchanges. Obamacare as originally conceived is a flawed policy and must be repealed,” said Sen. Marco Rubio, R-Florida, in a statement.
And the insurance industry responded with a grim warning.
“This latest rule change could cause significant instability in the marketplace and lead to further confusion and disruption for consumers,” said America’s Health Insurance Plans’ president and CEO Karen Ignagni. AHIP is a national group that lobbies for the health insurance companies.
There are fewer than 500,000 people whose health insurance plans were canceled and haven’t yet signed up for new ones, administration officials said.
That’s far lower than some forecasts by opponents of the health law indicating that millions of policyholders would lose their coverage because their plans did not meet new standards required under the health law.
President Barack Obama had repeatedly promised that people could keep their plans if they liked them under the reforms he championed.
But insurance companies began cutting off many who purchased policies individually. Most Americans who have insurance are covered under employer plans.
Administration officials said on Thursday they expect an enrollment surge ahead of Monday’s sign-up deadline to ensure coverage on January 1.
And while officials say enrollment appears “robust and strong” in December, they anticipate a drop-off in January, when a looming deadline isn’t spurring people to sign up.
The next spike, they say, will come in March, which is the last month Americans can enroll in insurance before being assessed a penalty.
Enrollment has been increasing since a disappointing start due to the disastrous rollout of the federal website, HealthCare.gov, where consumers can shop and purchase plans.