Posted by: theoptimisticconservative | November 13, 2013

The Pants on Fire Report: Covered California required insurers to cancel plans

President Obama blamed health-insurance cancellations on “bad-apple” insurers, who presumably offered and then cancelled the lousy, cut-rate insurance plan that you liked, but don’t get to keep, because they (the insurers) are bruised and full of worms.

That’s the extent of the rational explanation the president offered for the supposed “bad-apple” cancellations:  that they were perpetrated by “bad apples.”  Which, by definition, as we all know, do “bad apple” things.

But it turns out that, in California, at least, the bad apples were actually located in the administration of the Covered California (Obamacare) state health exchange.  They were the ones who, quite literally, required the cancellation of the insurance policies Californians liked.

Now, this whole “debate” – which has really been more like the exchange of pleasantries between opposing European soccer fans – has been a slogan-intensive bait-and-switch confrontation all along.  None of it has made sense, on the Obama-left side of the argument.  The president’s apparent assertion about “bad-apple” insurers is that they were taking advantage of you by selling you cut-rate “junk” insurance, so now, with the government forcing them to sell you more expensive non-junk insurance, it’s their fault that they have cancelled your old cut-rate policy, and will be charging more for coverage and deductibles you didn’t request or agree to.  (Come on, Obama-left: you can’t pretend that higher premiums, for higher deductibles and mandated coverage that people don’t need or want, are “better.”  The American people may be dumb, but we’re not stupid.  We know worse when we see it.)

Critics on the right have approached what we might call the Obama Implication, about “bad-apple” insurers, as if there is something intelligible there to argue against.  Some critics have argued that insurers weren’t selling “junk” policies.  (Did subscribers with Kaiser and Blue Shield, for example, really think they had “junk insurance”?)

Bad apples.  BAD!

Bad apples. BAD!

 

Others have argued that, whether they were or weren’t, Obamacare is still what caused the insurers to have to drop the policy you liked, because its provisions make your favored policy non-compliant starting on 1 January 2014.

The latter argument is a deductive one, which may or may not gain traction with the American demographic that has European-soccer-fan brain.  The argument requires making the abstract connection between policy non-compliance and the necessity, under law, to stop offering policies.

But the revelation about Covered California requires no such powers of deductive reasoning.  Citing the explicit provision in the contract insurance companies had to sign to join the Covered California exchange, Cal Watchdog and the San Francisco Business Times have identified exactly which entity mandated that the policies Californians like today be cancelled.  That entity is Covered California.  Here is the language from the contract:

Contractor agrees that effective no later than December 31, 2013, except as otherwise provided in State Law, it shall terminate or arrange for the termination of all of its non-grandfathered individual health insurance plan contracts or policies which are not compliant with the applicable provisions of the Affordable Care Act.  Contractor agrees to promote ways to offer, market and sell or otherwise transition its current members into plans or policies which meet the applicable Affordable Care Act requirements.  This obligation applies to all non-grandfathered individual insurance products in force or for sale by Contractor whether or not the individuals covered by such products are eligible for subsidies in the Exchange.

In the “Well, duh” corner, we have this observation at the SF Business Times (emphasis added):

[I]n California… health insurers who hoped to participate in the Covered California exchange had to agree to the changes in order to be part of the federally subsidized health insurance marketplace.

Otherwise, many healthy people may have decided to stay with their existing individual and family plans, leaving Covered California… to deal with a potential deluge of sick people seeking coverage and not enough healthy ones to make the project actuarially sound.

For some reason, meanwhile, the forcible tinkering with people’s health insurance isn’t causing important numbers to go in the direction they’re supposed to:

Interestingly… the average age of persons enrolled in Obamacare is 51-54. By contrast, in 2013 the average age of someone enrolled in pre-Obamacare insurance was 41, which is close to the U.S. median age of 37 years.

“This is significantly going to blow costs up, and taxpayers will be on the hook to pay for the difference,” said [Obamacare expert Craig] Gottwals.  That’s because older people require more health care.

He said there is a bailout plan already written into the Affordable Care Act, which requires U.S. taxpayers to pay the difference between what care is covered and what is not.  “It is going to go way over budget, and taxpayers are on the hook for 80 cents on every dollar,” said Gottwals.

Breaking news as this goes to post:  In the top-of-the-hour news break on KFI AM 640, I just heard that Blue Shield (and apparently another company, whose name I didn’t catch) will be restoring about 100,000 cancelled policies in California.  The policies will be effective only through 28 February 2014, however.  I’ll supply a link and/or update on this information as it becomes available.

J.E. Dyer’s articles have appeared at Hot Air, Commentary’s “contentions,Patheos, The Daily Caller, The Jewish Press, and The Weekly Standard online. She also writes for the new blog Liberty Unyielding.

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Responses

  1. Its all falling apart because the economic underpinings of the law were never solid, demonstrating a failure by the left to understand the very basics of supply and demand and marginal cost/benefit analyses that most consumers do instinctively every day.

    Those on the left were either lying – which means they have no business being in a position of power – or stupid – which means they also have no business being in a position of power. Everything that has occurred, with the notable exception of the failure of the fed exchange website, was forecast by knowledgable observers of and particpants in the health care/insurance industry. Their livelihood depended on their competence, their knowledge.

    If you thought the ACA would meet its promises – whether as a politician or a voter, you have my condolences. Its tough believing in fantasy and being proven wrong. And either ignorant or lacking the very basic character attributes we expect of functioning adults.

    If you thought this would work you should be ashamed of yourself.

  2. It’s pretty pathetic that the Obama has to portray himself as the most ignorant President in history. He just didn’t know anything. It is even more pathetic that the people are not only buying that story, but excusing it.

    • They aren’t – polling of under 35 year olds say they thing Obama LIED to them.

      This won’t end well for the democrats.

      • I hope you are right, but I would not be surprised to see da yoots vote for the next Democrat Hopey-Changey candidate who promises free BC.

        • Fair concern, and not an unrealistic possibility. But when you think someone lied to you – and the polls pretty much are saying that across the board, it goes much deeper than just normal political disappointments. Its personal now.

          Very dangerous situation for the prez – and for those senators and swing house district democrats facing a ticked off electorate.

  3. ObamaCare is the gift that will just keep on giving for Republicans. The Prez wants Insurance Companies to restore “Substandard Policies” because Congressional Democrats are scared, not because American Citizens are being hosed big time. Please pause and give that some thought.
    Think of ObamaCare as an Federal New Car Plan: (Cash For Clunkers Anyone?)
    Let me state for the record ” If you are not driving a Bentley, you are driving a substandard car. All cars other than Bentleys should be scrapped. The Feds will subsidize your new Bentley. After you “free” subsidy the Bentley price will be reduced from $500,000 to $5,000. No down and finance for 10 years. If you live in a section 8 apartment, the Feds will pay for a 24 hour guard/driver.
    Delaying the initial pool of young healthy payers (yes I can hear the laughter here in Oklahoma) premiums will increase even more later on. The employer mandate will start to kick in during the run up to the 2014 mid terms.
    President Wrong Way Peach Buzz ( I always loved Rocky and Bullwinkle) will spend the next 12 months trying to delay or cancel his signature legislation.
    A delicious, spectacular, ironic, abominational end to Hopey Changey. ( I love the smell of Napalm in the morning)
    On the other hand ObamaCare may be perfect legislation and I am just a Racist clinging to my Bible and gun.

  4. The implosion of Obamacare reminds me of the Watergate days: back then, each day I could hardly wait to open the Washington Post and learn of another level of corruption and malfeasance.

    The only difference — and a troubling one — today is that, for our friends on the Left, it’s like the silence of the lambs. They literally don’t talk about any of the problems with Obamacare. Like they’re hoping it will all just go away.

    What is further astounding is Barry’s brazen behavior. He not only lied in 2010, he actually drafted regulations that facilitated and exacerbated his lie re keeping your plan. Then he lied after his regs were in effect. And he continued to repeat the lie in recent months.

    Now he’s saying: sure I lied but I’m going to do you the big favor of telling the insurance companies they don’t have to enforce my lie for a year.

    If we had a real press corps, they would have walked out on this loser at his one hour press “conference” (read narcissistic bloviation) after 10 minutes or, at least, would have interrupted the bozo and pestered him with questions about his lies and the unconstitutionality of his overnight “cure.” Instead, we get more silence from the lambs of the fourth estate.

    Sad, really. But it won’t stop Obamacare from continuing to fail. And to bring control of the Senate, hopefully, to the R’s.


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