Some personal news: I’m joining Business Insider as a political reporter starting Monday and I’m very excited for the move. I’ll be doing a combination of the same blogging I’ve been doing at this site plus additional in-person reporting.
Political Algebra isn’t going anywhere, but I will no longer be writing new posts here. I’ll try to update every so often with a selection of my favorite pieces over at BI. Definitely check there frequently for new content from me and the many all-star writers at the site. I’ve had a tremendous amount of fun writing here and I’m very grateful for everyone who has commented and interacted with me, either on the blog or via Twitter. Gaining blog views is difficult with the sheer amount of content readily available across the web so I’m also very thankful for everyone who spread my work. It’s been a privilege to contribute to political and policy conversations from this blog and I am looking forward to continuing to do so at Business Insider. Thanks for reading!
Yesterday evening, President Obama sat down with NBC’s Chuck Todd to talk about a couple of topics, most importantly the Affordable Care Act. The president offered a semi-apology to the American people for lying to them that if they liked their health care plan, they could keep it. With millions of people receiving cancellation notices, that line has been proven false. Obama finally confronted this in the interview:
You know– I regret very much that– what we intended to do, which is to make sure that everybody is moving into better plans because they want ’em, as opposed to because they’re forced into it. That, you know, we weren’t as clear as we needed to be– in terms of the changes that were taking place. And I want to do everything we can to make sure that people are finding themselves in a good position– a better position than they were before this law happened.
But it– even though it’s a small percentage of folks who may be disadvantaged, you know, it means a lot to them. And it’s scary to them. And I am sorry that they– you know, are finding themselves in this situation, based on assurances they got from me. We’ve got to work hard to make sure that– they know– we hear ’em and that we’re going to do everything we can– to deal with folks who find themselves– in a tough position as a consequence of this.
If you read this carefully, you’ll realized that Obama isn’t apologizing for his lie. He’s apologizing that people are receiving cancellation notices. But even this isn’t sincere, because Obama isn’t actually sorry about that. The only thing he is sorry about is that people are upset. In fact, he’s glad that people are receiving cancellation notices. This is a fundamental part of health reform.
There was no way that everyone was going to be allowed to keep their health plans under Obamacare. This is a feature, not a bug. Millions of Americans had health plans that did not adequately protect them in case of a medical catastrophe. Their plans were bare bone and risked leaving them with huge financial obligations if they became seriously ill. In addition, insurers were allowed to charge different prices to women and men. They could refuse to offer coverage to individuals with pre-existing conditions and could charge older people huge amounts more than sick people.
Obamacare changes all that. It requires insurers to cover everyone with pre-existing conditions, prevents them from discriminating between men and women and limits the amounts insurers can charge old adults to three times the amount they charge young ones. The law also requires insurers to cover 10 essential health benefits and eliminates lifetime caps on coverage. All of these regulations were meant to make the insurance market more fair. However, forcing insurers to cover more sick people and offer more comprehensive coverage drives up premiums, so Obamacare also includes huge amounts of subsides to offset this increase. Not everyone will be better off under the new system, but many will be.
What was clear from the beginning was that disrupting the market in this way would force most insurers in the individual market to cancel their plans. President Obama admits that he knew there would be disruptions in the interview:
I think we, in good faith, have been trying to take on a health care system that has been broken for a very long time. And what we’ve been trying to do is to change it in the least disruptive way possible.
The problem is, Obama didn’t promise to change the system “in the least disruptive way possible.” He promised to improve it with no disruption whatsoever. That was never a possibility, despite his repeated claims. The law technically grandfathers in all plans offered before 2010, but insurers cannot offer those on the exchanges if they do not fulfill all of the new coverage requirements. Of course, this effectively ensured that insurers would cancel most of those plans. The administration knew this from the beginning, but they also knew that health reform had little chance of passing if they told Americans that millions of them would lose their beloved plans, even if they said they would receive a better one with reduced premiums. Americans are scared of change, particularly in the health care market.
So, the administration lied. They knew eventually they would have to confront this falsehood, but that would be long in the future. The exchanges would be functioning and Americans would understand that the law ensured that most of them would receive better, cheaper coverage.
Unfortunately for the administration, the second part of that plan isn’t happening. The catastrophic start of HealthCare.gov has prevented Americans from seeing all of their new options. That has left millions of Americans with cancellation notices and no way to look up new plans. This is what Obama really regrets. People were never supposed to receive cancellation notices and then be unable to search for a new plan. Obama admitted this in the interview as well:
Keep in mind that most of the folks who are going to– who got these c– cancellation letters, they’ll be able to get better care at the same cost or cheaper in these new marketplaces. Because they’ll have more choice. They’ll have more competition. They’re part of a bigger pool. Insurance companies are going to be hungry for their business.
So– the majority of folks will end up being better off, of course, because the website’s not working right. They don’t necessarily know it right [now]
The reason Obama’s apology feels so fake is because he really isn’t sorry for people losing their plans or calling him on his lie. He’s sorry that they haven’t had the chance to shop on the exchanges, discover their new options and realize they are better off. Obama gambled that when people finally realized that he was lying, they would have already fallen in love with their new options. This bet was made long ago and so far, it’s been a huge bust.