Md. weighs options after Obama unveils fix to dropped insurance policies

Baltimore Sun staff and wire reports

— With millions of consumers — including 73,000 Marylanders — getting health insurance cancellation notices, President Barack Obama announced Thursday that he will encourage insurers to continue offering customers the same health plans next year even though many do not comply with the Affordable Care Act.

"This fix won't solve every problem for every person," the president said Thursday in remarks at the White House in which he took responsibility for the botched rollout of his health law. "But it's going to help a lot of people."

Obama said he would consider legislative action to go further. But he ruled out the sort of legislation that House Republicans are pushing, which would allow insurance companies to continue selling new policies, indefinitely, that do not comply with the law's new consumer standards.

"I will not accept" legislation that would "drag us back to a broken system," Obama said.

The president's move comes amid rising outrage over the cancellation notices, which insurers have sent to customers nationwide who do not have health plans through an employer. The Affordable Care Act was supposed to require health plans sold next year to offer consumers a new basic set of benefits.

The plan gives insurance companies federal permission to renew policies that otherwise would be canceled because they do not meet the new law's standards. But it does not require companies to renew them. Moreover, companies will need the permission of state insurance regulators to act.

Maryland officials said they are weighing their options in response to the announcement. They say it's too soon to say how many, if any, of the 73,000 policyholders will get an extension.

Minimizing disruptions in health care is an important goal, the Maryland Insurance Administration said in a statement. But the agency also said that "the president's announcement presents a number of complex issues that the insurance commissioner must carefully examine in considering options available to Maryland insurance carriers and policyholders."

The commissioner plans to convene a meeting of carriers in the state to help assess what is possible "from a practical and operational perspective."

CareFirst BlueCross BlueShield, the largest insurer in the state, said it's studying the implications of the president's announcement. The insurer had notified state insurance officials that it would not renew more than 43,100 policies.

"We will work quickly to understand how this proposed change affects our members and communicate directly with those who are or could be affected by the proposed change," the insurer said in a statement. "We urge everyone to understand that we are strictly bound by state laws. At the moment, it is unclear whether state laws would preclude us from doing what the president has proposed."

The insurer said it would notify subscribers soon. But even if policyholders are allowed to keep their plans for another year, at least one policyholder said that would not be enough.

Raymond Liu, a 35-year-old self-employed man from Fulton, said he wants to keep his plan for the foreseeable future. The CareFirst policy for him and his wife costs $300 a month and fits their needs, even if it doesn't include all the benefits required by the new health law.

"I get to keep it for another year ... that's it?" he said. "The issue was never that I needed more time to switch. The issue was that I never wanted to be compelled by the federal government to switch my health plan in the first place and have my freedom of choice abridged.

"President Obama needs to take charge and provide leadership over Congress that will uphold his original promise to the American people — and ensure that all of us who wish to keep our current coverage can do so. No tricks, extensions, or modifications that change the essential tenets of his promise. He shouldn't be trying to negotiate with the American people. He's the president, not some used-car salesman."

Public support for the law has faltered in the wake of the policy cancellations and the disastrous debut of the federal online insurance marketplace.

Some prominent Democrats are pressing for a more substantive legislative fix. And Republicans accused Obama of selectively enforcing the law to resolve political problems, just as he did by delaying enforcement of a requirement that large employers provide health benefits.

Obama conceded that the problems with the rollout of Obamacare have hurt his standing with Americans, saying he has to "win back some credibility" on the issue.

"We fumbled the rollout on this health care law," he said.

But he said that he was unaware that the federal online marketplace,, was riddled with technological flaws before it went live on Oct. 1. "I was not informed directly that the website was not working the way it was supposed to," he said.

The president said the website would be working better by Nov. 30, the administration's self-imposed deadline to fix it, but added, "It is not possible for me to guarantee that 100 percent of the people 100 percent of the time will have a perfectly seamless and smooth experience."

Obama said he understood why consumers who received cancellation notices from insurers were upset. "It's scary," he said. But he also encouraged them to look at better insurance options on the new marketplace where some also may qualify for subsidies.

The president also took a far more sober tone than he had in the past about the difficulties involved in buying insurance. "Buying health insurance is never going to be like buying a song on iTunes," he said, noting the complexities of comparing insurance plans. In the months preceding the rollout of the new law, Obama repeatedly compared the process to using websites such as Amazon or Kayak.

White House officials said Thursday that new plans sold next year would still have to offer the new benefits, which include hospitalizations, mental health services and maternity coverage.

But the officials said insurers would be free to offer their customers the option to remain on their current plans rather than switching to the new plans, which in some cases are more expensive.

If insurers offer this option, however, they would be required to notify consumers which benefits their current plans are missing. Insurers would also have to alert their customers that other options might be available on the new marketplaces created by the Affordable Care Act.

It is unclear how many insurers would opt to extend current plans. Industry officials have said that such extensions would be burdensome.

The White House move, which officials characterized as a "transition," would not allow health insurers to sell current plans to new customers next year. House Republicans have been pushing for this, which most health experts believe would effectively destroy the new marketplaces created by the health law.

The president was under intense pressure from Democrats on Capitol Hill to find a fix. Democratic unity crumbled as lawmakers were pounded by their constituents over the rocky rollout of Obamacare, especially as many members begin tough re-election battles.

House Democrats have increasingly threatened to support a Republican plan due for a vote today that would allow insurers to continue to offer plans that don't meet new standards in the health care law. Democratic senators have offered their own legislation.

Baltimore Sun reporter Meredith Cohn and Tribune Washington Bureau reporters Noam N. Levey, David Lauter, Lisa Mascaro and Michael A. Memoli contributed to this article.