In an unexpected shift, the Obama Administration on Thursday night said that millions of Americans who have had their health insurance plans canceled will be able to claim a “hardship” exemption, allowing them to buy a less comprehensive insurance plan in 2014, and that those same consumers will also be exempted from penalties associated with the individual mandate in the Obama health law.
Republicans immediately denounced the move, labeling it another admission that the underlying health reform plan isn’t working.
“This is a slap in the face to the thousands of Americans who have already purchased expensive insurance through the ObamaCare exchanges,” said Sen. Marco Rubio (R-FL).
There was also a thumbs down from the major health insurance group that has been working with the feds to deal with all the ups and downs of the health law.
“This latest rule change could cause significant instability in the marketplace & lead to further confusion & disruption for consumers,” read a statement from the trade group AHIP, America’s Health Insurance Plans.
Just a day before, AHIP had unveiled a plan to give people until January 10 to sign up for insurance and pay, and still get coverage retroactive to January 1 – but on this audible by the federal government, AHIP was not on board.
The change was detailed Thursday night in a letter to Democratic Senators by HHS Secretary Kathleen Sebelius.
“Look forward to our work to make sure that people understand their options of affordable health coverage,” Sebelius scribbled in black pen at the bottom of the typewritten letter to five Senators.
So, let’s boil down this change:
1. It applies only to people who have had their health insurance plans canceled.
2. Those people don’t have to buy a Gold, Silver or Bronze plan through the exchange – instead, they can purchase the less comprehensive “Catastrophic” plan, which only certain younger consumers were eligible for. Those plans are 20% cheaper.
3. The decision also – for this same group of consumers – waives any penalties under the individual mandate next year for not having the required ‘minimum coverage’ for health insurance.
4. The feds have set up a special help line just for people who have lost their insurance and now need to get new coverage – 1-866-837-0677.
Republicans have been wondering if the White House will make further changes to the Obama health law right around Christmas – after all, there were major changes announced just before Thanksgiving and July 4.
We’ll see if more are on the way in coming days.