White House Claims Millions of Obamacare Cancellations Now Fixed

The Obama Administration announced on Thursday that individuals whose health insurance plans were canceled due to Obamacare may receive a “hardship exemption” from the $95 fine, a significant development that even progressive Washington Post columnist Ezra Klein says “puts the first crack in the individual mandate.”

Yet even as the Obama administration issued the key concession--one that opens up numerous arguments for extending similar exemptions to others--the administration claimed its latest rule change would only affect an estimated 500,000 of the 6,000,000 Americans who have lost their health plans due to Obamacare; the White House claims the other 5,500,000 people that Obamacare kicked off their plans have already found new coverage.

Health and Human Services (HHS) spokesperson Joanne Peters further downplayed the rule shift and number of individuals affected by saying, “For the limited number of consumers whose plans have been canceled and are seeking coverage, this is one more option.”

The White House’s figures, however, are unreliable for myriad reasons.

First, as even progressives like Klein concede, “There’s no truly reliable figure here.” Furthermore, notes Klein, insurers “worry the White House is underestimating the number of people whose plans have been canceled and who will opt to either remain uninsured or buy catastrophic insurance rather than more comprehensive coverage.”

Second, it is unclear upon what basis the Obama administration makes its 500,000-person claim when even its own most recent estimate is that just 364,682 people have placed a plan in a shopping cart on the federal HealthCare.gov website. 

Moreover, HHS Sec. Kathleen Sebelius herself admitted last week in testimony before the House Energy & Commerce Committee that she did not know how many of those 364,682 individuals had actually activated their plans by making their first month’s premium payments. Even if every single one of those who have put a plan in a shopping cart on HealthCare.gov were among the six million who have thus far lost their insurance due to Obamacare, that would still leave 5,635,318 Americans who would either have had to go through the 14 state healthcare exchanges or find new--and likely more expensive--private plans and pay their first month's premium check to activate their coverage. 

Is that possible? Maybe. But if the White House does not know what portion of the 364,682 people with plans in their shopping carts have activated their plans by cutting their first check, how is it that they claim to know that 5,500,000 Americans have done the same?  

Finally, the White House’s 500,000-person estimate strains credulity because it raises the obvious question: Why would the administration put, to borrow Klein’s phrase, “the first crack” in the all-important individual mandate if just a “limited number of consumers” were affected? Indeed, as America’s Health Insurance Plans President Karen Ignani says, “This latest rule change could cause significant instability in the marketplace and lead to further confusion and disruption for consumers.” Why would the Obama administration risk all that--and the underlying premise of its axial individual mandate--if millions of people booted off their plans were already re-enrolled and in new and better plans?

To be sure, with just three days to go before the December 23 Obamacare enrollment deadline, the White House is scrambling to do all it can to reach its goal of herding seven million people into the Obamacare exchanges by the end of March.


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