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Obama to Speak on Health Law Fixes as Democrats Seek Action

Photographer: Jim Watson/AFP via Getty Images
Obama will speak at the White House at about 11:35 a.m. Washington time, shortly before top aides were to meet with Democrats to discuss proposed action.

President Barack Obama, under pressure from Democratic lawmakers to stem insurance policy cancellations for hundreds of thousands American, will make a statement on potential changes in his health-care law.

Obama will speak at the White House at about 11:35 a.m. Washington time, shortly before top aides were to meet with Democrats to discuss proposed action.

The administration yesterday indicated it was willing to consider Democratic legislation to halt some of the insurance cancellations that have raised alarm among voters and lawmakers. Previously, Obama and his aides stressed that they were searching for solutions that wouldn’t require congressional action.

Obama’s chief of staff, Denis McDonough, will meet today with Senate Democrats who have been lobbying for action. The White House also plans a briefing for House Democrats, some of whom say they’ll back a Republican bill scheduled for a vote tomorrow unless Obama comes up with a remedy.

The Fate of Obamacare

The debut of the insurance marketplace at the core of the law, Obama’s signature achievement, has been marred by troubles with the federal online exchange and by the insurance cancellation letters. In the debate over the law, Obama had repeatedly promised that Americans who liked their existing insurance plans would be able to keep them.

Confronting Aides

House Democrats yesterday confronted David Simas, the deputy senior adviser to the president, and Mike Hash, the director of the Office of Health Reform at the Department of Health and Human Services, during a closed-door meeting.

“A lot of Democrats are very upset that this happened, No. 1, and urging for there to be an immediate fix for it,” Representative Patrick Murphy, a Florida Democrat, told reporters after the meeting.

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The administration is seeking to calm Democrats in advance of a vote expected in the House tomorrow on a proposal from Michigan Republican Representative Fred Upton to let individuals keep existing policies through next year.

Representative Mike Doyle, a Pennsylvania Democrat, said many of the party’s lawmakers will support Upton’s bill if they have no alternative.

“What we said to the administration is, if you don’t give us something else before Friday, I think you’re going to see many Democrats, as a way of sending a message to the American people and the White House, that we believe this needs to be fixed and it needs to be fixed now,” Doyle said this morning on MSNBC’s “Morning Joe” program.

Republican Bill

The White House opposes Upton’s measure because it would undermine the law by letting insurers “sell new policies that were substandard,” White House press secretary Jay Carney said yesterday.

House Democratic leader Nancy Pelosi of California said that the president will offer a proposal today. “It could be an administrative fix, it could be a legislative fix,” Pelosi said at a forum in Washington. ’’I would prefer an administrative fix because it could be done much more quickly without any accompanying agendas.’’

Obama may have limited authority to make changes without going to Congress for changes in the law.

One potential option would be to take steps to ease early renewal of health-insurance plans, since Obamacare’s new requirements for policies only apply to those issued after Dec. 31. Some states already authorize early renewals.

Obama’s Authority

Obama has clear authority to help those who have continuously maintained coverage through the same policy at least as far back as March 23, 2010, said Alden Bianchi, a Boston attorney and former outside counsel to then-Massachusetts Governor Mitt Romney’s administration on his state’s health-insurance revamp.

The president can alter “stringent” regulations the administration issued to enforce the grandfather clause in the health law, known as the Patient Protection and Affordable Care Act, and make it easier for their policies to gain exemptions, said Bianchi.

Ezekiel Emanuel, who worked on the Obama health-care law when he was an official in the White House budget office, agreed that the law gives Obama authority to determine which plans are covered by the grandfather rule. He can alter its interpretation of what constitutes a major change in the policy, said Emanuel, a University of Pennsylvania professor.

Regulation Limits

The administration’s current regulations, for example, don’t allow insurers to retain their plans’ grandfather status if they raise their co-pays by more than the amount of the medical inflation rate plus $5 or plus 15 percent, whichever is greater, said Bianchi. It is within the administration’s discretion to revise such regulations, said Bianchi, author of Bloomberg BNA’s “Health Care Reform Adviser.”

While the administration’s regulations leave it up to insurance companies to decide whether they will assert grandfather status for their policies, the administration could make a regulatory change that allows individual policyholders to force the status for plans they wish to retain, Bianchi said.

Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, an industry trade group, said practical considerations would complicate attempts to reverse policy cancellations that are under way. Health insurance is regulated by states, and in many cases insurers already notified state regulators and customers that they’re ending plans.

“There are many questions about how you would go back and undo what’s been done this late in the process,” he said.

A proposal by Louisiana Senator Mary Landrieu and other Democrats to let individuals keep their health-care policies as long as they’re current on payments “shares the goal” of Obama for fixing the health-care law, Carney said in his daily briefing yesterday.

“We’re going to work with her and we’re going to work with others,” he said. “We’re open to, as I said, both legislative and administrative solutions.”

To contact the reporters on this story: Roger Runningen in Washington at rrunningen@bloomberg.net; Mike Dorning in Washington at mdorning@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net

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