If you read a story about yesterday’s press conference with President Obama on the Affordable Care Act, you would learn that the President proposed a fix for people who have had their insurance cancelled. He apologized for the lousy web site. And so on. I don’t know how you legally change a piece of legislation by fiat like the President seemed to do, but put that aside for the moment. What I found more interesting was how the President responded to the accusation that he had lied. To really understand what happened, it’s best to read the actual words from the transcript and not a news story that inevitably has to miss some of the details. Major Garrett asked a two-part question. The first part was about the apparent dishonesty of the President who had said many times that if you liked your health insurance you could keep it. Here is Garett’s question.
Q: Thank you, Mr. President. You say, while the law was being debated, if you like your plan you can keep it. You said, after the law was implemented or signed, if you like your plan you can keep it. Americans believed you, sir, when you said that to them over and over.
Do you not believe, sir, the American people deserve a deeper, more transparent accountability from you as to why you said that over and over when your own statistics published in the Federal Register alerted your policy staff — and, I presume, you — to the fact that millions of Americans would in fact probably fall into the very gap you’re trying to administratively fix now? That’s one question.
What Garett was asking was, it appears that you lied, Mr. President. Can you explain what you were thinking? Was it a lie or a mistake? It’s a tough question to ask but it’s a fair question and it’s what a lot of people are wondering. It’s also a tough question to answer. There are many ways to answer the question. Here is how the President answered it. It’s a very long answer. The length is interesting. He couldn’t just say he had lied. Or had made a mistake. His answer ultimately was that he had meant it to be a true statement but it didn’t work out that way. He thought the grandfathering would work. I’m not sure that’s a credible answer. But he couldn’t stop there. He had to explain that his promise turned out to be true for most people. Only about 5% of the American people are at risk of being canceled. That’s a strange thing to say. I’m not sure what to make of it. Was he trying to say that for 95% of you out there listening and watching, I told the truth? Or is he saying, I made a mistake, sure, but it was a small mistake? Either way, that doesn’t strike me as a very good answer. And then at the end he tries to claim that a lot of the people who got canceled would have been canceled anyway because the individual market is full of capricious decisions, so really, it’s not even close to 5%.
Does that make you feel better about his broken promise? Very strange. I know it’s a tangled web and maybe he really didn’t intend to deceive. But it seems like this isn’t going very well.
With respect to the pledge I made that if you like your plan you can keep it, I think — you know, and I’ve said in interviews — that there is no doubt that the way I put that forward unequivocally ended up not being accurate. It was not because of my intention not to deliver on that commitment and that promise. We put a grandfather clause into the law but it was insufficient.
Keep in mind that the individual market accounts for 5 percent of the population. So when I said you can keep your health care, you know, I’m looking at folks who’ve got employer-based health care. I’m looking at folks who’ve got Medicare and Medicaid. And that accounts for the vast majority of Americans. And then for people who don’t have any health insurance at all, obviously that didn’t apply. My commitment to them was you were going to be able to get affordable health care for the first time.
You have an individual market that accounts for about 5 percent of the population. And our working assumption was — my working assumption was that the majority of those folks would find better policies at lower cost or the same cost in the marketplaces and that there — the universe of folks who potentially would not find a better deal in the marketplaces, the grandfather clause would work sufficiently for them. And it didn’t. And again, that’s on us, which is why we’re — that’s on me.
And that’s why I’m trying to fix it. And as I said earlier, my — I guess last week, and I will repeat, that’s something I deeply regret because it’s scary getting a cancelation notice.
Now, it is important to understand that out of that population, typically, there is constant churn in that market. You know, this market is not very stable and reliable for people. So people have a lot of complaints when they’re in that marketplace. As long as you’re healthy, things seem to be going pretty good. And so a lot of people think, I’ve got pretty good insurance, until they get sick, and then suddenly they look at the fine print and they’ve got a $50,000 out-of- pocket expense that they can’t pay.
We know that on average over the last decade, each year premiums in that individual market would go up an average of 15 percent a year. I know that because when we were talking about health care reform, one of the complaints was, I bought health care in the individual market, and I just got a notice from the insurer they dropped me after I had an illness or my premiums skyrocketed by 20 or 30 percent; why aren’t we doing something about this?
So part of what our goal has been is to make sure that that individual market is stable and fair and has the kind of consumer protections that make sure that people don’t get a rude surprise when they really need health insurance.
But if you just got a cancelation notice and so far you’re thinking, my prices are pretty good, you haven’t been sick, and it fits your budget, and now you get this notice, you’re going to be worried about it. And if the insurer is saying the reason you’re getting this notice is because of the Affordable Care Act, then you’re going to be understandably aggravated about it.
Now, for a big portion of those people, the truth is, they might have gotten a notice saying, we’re jacking up your rates by 30 percent. They might have said, from here on out we’re not going to cover X, Y and Z illnesses. We’re changing the — because these were all 12- month policies. They — the insurance companies were no — under no obligation to renew the exact same policies that you had before.
But look, one of the things I understood when we decided to reform the — the health insurance market, part of the reason why it hasn’t been done before and it’s very difficult to do, is that anything that’s going on that’s tough in — in the health care market, if you initiated a reform, can be attributed to your law. And — and so what we want to do is to be able to say to these folks, you know what, the Affordable Care Act is not going to be the reason why insurers have to cancel your plan. Now, what folks may find is the insurance companies may still come back and say, we want to charge you 20 percent more than we did last year, or we’re not going to cover prescription drugs now. But that will — that’s in the nature of the market that existed earlier.