According to insurance industry executives, federal officials have been asking health plans to provide insurance starting Jan. 1 even for customers who sign up after a looming deadline on Monday.
While some plans have agreed, many are rebuffing the request because they cannot logistically accommodate it or out of frustration with a series of late-breaking rule changes from the Obama administration.
The appeals to insurers follow an announcement this month by Health and Human Services Secretary Kathleen Seblius, who urged health plans to be flexible as the long-awaited start of new insurance under the 2010 Affordable Care Act is about to arrive.
The prodding and the industry’s ambivalence underscore the multifaceted efforts by the Obama administration to improve lagging enrollment under the law as it enters a pivotal phase. As of Jan. 1, the law requires most Americans to have insurance or risk a fine.
In public, the president and his aides contend that the new federal insurance marketplace has turned a corner after rocky beginnings with a defective Web site, HealthCare.gov, that frustrated many Americans trying to choose health plans. But some administration maneuvering also suggests that not everyone who may want health insurance will be able to enroll in time.
The appeals to insurers, underway for about a week, are part of the administration's on-going tinkering with the policies and the computer technology that form the backbone of the government's most ambitious undertaking in decades to extend health coverage to millions of uninsured Americans.
In one abrupt change, the Obama administration announced Thursday night that it was relaxing the rules for people who bought insurance policies on their own that are being canceled because they fall short of new federal benefits standards. HHS officials announced that those customers will be allowed to claim a hardship exemption, freeing them to buy bare-bones “catastrophic” insurance or no insurance at all.
The decision prompted immediate protests from insurance industry leaders, who predicted that the change would confuse consumers and destabilize a new insurance market that hinges on the sick and healthy being in the same “risk pools.”
By Friday, congressional Republicans had joined in the criticism, shifting their argument from earlier in the fall when they argued that people should not be forced to buy insurance and should be allowed to keep bare-bones health plans.
“By delaying the individual mandate . . . for some individuals and not others, the president has once again shown favoritism and unfairness under the law,” said Rep. Gus Bilirakis (R-Fla.)
Sen. Orrin G. Hatch(R-Utah) said there was “no clarity as to when people should sign up and who they should pay and when.”
At his final scheduled news conference of the year, Obama defended the change. He said the policy announced by HHS was aimed at “a very specific population that received cancellation notices from insurance companies,” many of whom have already either renewed their policies or found “a better deal” through the law’s insurance marketplaces.
“If there are adjustments that can be made to smooth out the transition, we should make them,” Obama said. “But they don’t go to the core of the law.”
The president also announced that “more than 1 million Americans have selected new health insurance plans” on the state and federal level since the new marketplaces opened on Oct. 1, including more than half a million through HealthCare.gov so far in December. The total federal enrollment as of Friday was roughly 740,000, according to government figures that have not been made public.
When asked to identify his biggest mistake of the year, Obama reiterated the apology he has made for what he described as the troubled first six weeks of the insurance Web site. “And since I’m in charge, obviously, we screwed it up,” he said.
The president said its failure was caused partly by “how IT procurement generally is done,” and “part of it had to do with the fact that there were not clear enough lines of authority in terms of who was in charge of the technology and cracking the whip on a whole bunch of contractors.”
“And I’m going to be making appropriate adjustments once we get through this year, and we’ve gotten through the initial surge of people who have been signing up,” he added.