President Obama announced Thursday that he supports allowing insurance companies that sell plans that don’t fully comply with the provisions of the Affordable Care Act to continue to make those plans available in 2014.
On the surface, this is a huge relief to people like me, who received notices in the mail from our insurance companies that our existing plans would be canceled when Obamacare comes fully online, and we would be funneled into more expensive plans under the new health exchange. I personally am staring at a 43% hike in monthly premiums, a 30% boost to my maximum annual out-of-pocket expenses, and double and quadruple copays for doctor and urgent-care visits, respectively.
I’ll be thrilled if I can hold on to my old plan for another year until the kinks are worked out in the exchanges.
“Buying health insurance is never going to be like buying a song on iTunes,” the president noted. “This fix won’t solve every problem for every person.”
Unfortunately, he’s right.
Just because insurance companies are allowed to continue selling my plan and others like it that do not meet the full provisions of the law doesn’t mean they will. The president has made it an option, not a mandate.
There’s no incentive.
The inexpensive catastrophic plan I purchased was likely offered as an enticement to young, healthy people like myself who would otherwise skip purchasing insurance altogether. Now that the law mandates that all U.S. citizens purchase health insurance or face a tax penalty, why would a private insurance company continue to offer me an inexpensive plan, knowing that if I don’t sign up for a more expensive option and forgo insurance, I’ll be penalized by the government?
Private insurance companies don't have the best interests of consumers in mind. Market forces can keep these companies honest. As could competition from a Medicare-like public insurance entity not governed by the profit motive. Unfortunately, the law doesn’t provide for either of these cost-cutting possibilities. Though the exchanges include several private insurers that compete for customers, the insurance mandate largely takes away the biggest advantage consumers enjoy in an open market -- the option not to purchase insurance at all.
I’m thankful the president agreed to change provisions of the healthcare law so that, in theory, I will be able to keep my existing plan. Insurance companies, in an effort to keep as many healthy people on the rolls as possible, may comply. But I still fear my plan will be a goner.
Matthew Fleischer is a Los Angeles-based freelance journalist. Follow him on Twitter @MatteFleischer.Copyright © 2014, Los Angeles Times