“What the president said and what everybody said all along is that there are going to be changes brought about by the Affordable Care Act to create minimum standards of coverage,” said White House Press Secretary Jay Carney.
So what’s going on here? It’s a complicated subject, so we’ll try to explain it as simply as we can.
First, what’s at issue here are health insurance policies that people buy themselves on the open market, because their employers do not offer insurance, they work for themselves, or they don’t work and don’t qualify for Medicare or Medicaid. It is not about employer-provided health plans, which is how most workers get their coverage.
Second, Obamacare regulations raise the bar for such plans. The ACA requires that they provide fuller and more complete coverage than they did before. Many old cheaper plans that offer coverage only for catastrophic events or that have high deductibles may not meet these new rules.
Third, there is a provision in the ACA that grandfathers in plans in existence at time of the law’s passage in 2010. But there’s a catch: They had to remain unchanged to qualify for this status. Any alteration in beneficiaries, co-pays, coverage, or other relatively routine item meant they had become new plans in the eyes of Obamacare.
So that’s the context. What’s happening now is that people with un-grandfathered individual plans that don’t meet new rules are getting notices that their current coverage is being canceled. In most instances, they’re being offered a new policy that’s Obamacare-compliant. But in some, maybe many, cases, that new policy is more expensive, because it offers more.
Middle- and lower-income Americans might qualify for government Obamacare subsidies to pay for this coverage, of course. But they’re still facing sticker shock and a loss of their current insurance arrangements.