President's Coverage Promise Is No Keeper

By David S. Hilzenrath
Washington Post Staff Writer
Monday, August 17, 2009

The debate over health care has become an all-out battle, as the administration, lawmakers and a panoply of interest groups vie to promote their own agendas. In coming weeks, we'll be putting some of their competing claims to the test Under the Microscope.

President Obama promises that, if health-care reform is enacted, people will be able to keep their current coverage.

"I keep on saying this but somehow folks aren't listening: If you like your health-care plan, you keep your health-care plan. Nobody is going to force you to leave your health-care plan," he said Saturday in a town hall meeting in Grand Junction, Colo., much as he said Friday in Belgrade, Mont., and earlier in the week in Portsmouth, N.H.

However, under legislation drafted by House and Senate Democrats, that would not necessarily be true.

Legislation written by three House committees and the Senate Committee on Health, Education, Labor, and Pensions would allow eligible employers to move workers into a new marketplace for insurance, where they could choose from various coverage options.

In the marketplace, called an exchange or gateway, employees could end up with more and better options, analysts say. Even a top Republican staffer to the Senate committee, who is not authorized to speak for the record, agrees with that assessment. But Democratic legislative aides said there is no assurance that any of the options offered in the exchange would be the same as employees' current coverage.

Because coverage offered through an exchange would have to comply with new requirements, it could easily be different.

At a minimum, the exchanges would be open to small employers, but government officials would have the discretion to open the exchanges to larger employers.

"Over time, the Exchange will be opened to additional employers as another choice for covering their employees," the three House committees said in a July summary of the emerging legislation.

The legislation could also prompt some employers to drop coverage, congressional budget analysts say.

In a report last month on a bill advanced by House Democrats, the Congressional Budget Office said millions of people would gain employment-based coverage and millions would lose it. The CBO estimated that the number of people gaining the coverage would exceed the number of people losing it.

As for the losers, "CBO and the JCT [Joint Committee on Taxation] staff estimate that, in 2016, about 3 million people (including spouses and dependents of workers) who would be covered by an employment-based plan under current law would not have an offer of coverage under the proposal," the CBO said.

The CBO was defining employment-based coverage to include an unspecified number of people who would obtain coverage through an exchange with a financial contribution from their employer. The CBO analysis left open the possibility that a larger number of people would lose employer-based health benefits in a more familiar sense -- coverage procured or provided directly by the employer.

In an interview, White House spokeswoman Linda D. Douglass acknowledged that employers could stop offering coverage. "The CBO has concluded that the dropping of coverage will be minimal," she said. "That is not to say that some employers will not drop coverage."

The CBO's analysis "confirms that health insurance reform would strengthen, not weaken, the employer-based system," Douglass added in an e-mail.

Under the House legislation, many companies eventually would have to comply with new requirements for minimum benefits, meaning that if they did not already meet the standard they would have to upgrade their insurance.

Nonetheless, in his effort to allay fears about health reform, Obama has continued to make his promise.

"Here's the guarantee that I've made: If you have insurance that you like, then you will be able to keep that insurance," he said July 28 in a town hall meeting with members of AARP.

In a campaign to dispel alleged myths about health reform, the White House has posted a "Reality Check" on its Web site. "You can keep your own insurance," it declares.

Obama's promise is not just at odds with legislative proposals -- it is also at odds with reality. Under the current system, employers can drop coverage, alter benefit packages and switch insurers. In addition, as the president has noted, people who lose or leave their jobs can lose their health plans; that is one of the fundamental problems the legislative proposals address and one of the main arguments for reform.

But in the campaign to overhaul health care, Obama's promise may serve to reassure people anxious about change. As he said at a news conference on July 22, people may favor the devil they know over the devil they don't.

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