By Kathleen Hennessey and Christi Parsons
8:11 PM EST, November 8, 2013
NEW ORLEANS — Administration officials scrambled Friday to find a quick fix to a problem President Obama said would never come about — millions of insurance policies canceled for people who have health plans they want to keep.
But as the controversy threatened Obama's efforts to reassure fellow Democrats that he had things under control, administration officials and policy experts said they didn't yet have a plan to solve the problem without further bogging down the president's signature health reform plan.
Obama said Thursday he was sorry for the mishap and promised to resolve it, but many in the health industry were surprised by the president's assertion that potential fixes were being considered and said they had not been consulted on the options the administration may be considering.
Reinstating canceled policies would be a scramble for insurance companies, whose coverage plans need to be approved by state regulators — a process that can take months.
"We have some significant concerns with how these proposals would work operationally," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans, the industry lobby. "It raises a number of questions."
Speaking Friday to a crowd of supporters in New Orleans, Obama vented his frustration about the troubled startup of the healthcare marketplaces, saying that he would personally fix the biggest problem, the healthcare.gov website, if he could. But, he said, "I don't write code."
"We're working overtime to make sure it gets fixed," Obama told the audience at the Port of New Orleans. "I promise."
Keeping that promise may prove complicated. About 5 million Americans with individual insurance policies are facing cancellation and rate hikes to get coverage under the program, contradicting pledges Obama has made over the last three years. Until the administration works out the kinks in its online sign-up system, most of those people won't know whether they might have access to lower premiums in the new marketplace.
White House officials want an administrative solution to the cancellation problem rather than a change to the law. An effort to reopen the law for this limited revision would probably open the floodgates to Republican attempts to gut and delay the entire law. The White House has not yet settled on a way to avoid that.
The pressure is on to find a quick solution, with Obama in danger of losing the backing of fellow Democrats who have been supportive of his 2010 law. Sen. Mary L. Landrieu of Louisiana, a Democrat facing a tough reelection battle next year, flew with the president to New Orleans amid her ongoing effort to push the White House to fix the law.
Trying to buy time for the sign-up website to begin working in earnest, Obama apologized in an NBC interview to those who believed his earlier assurances that people would be able to hold on to policies they were happy with. With that mea culpa on the eve of his trip, aides hoped Obama's visit here would focus on boosting American exports through upgrades in roads, bridges and ports.
But healthcare still dominates the conversation. House Republicans were pushing their own ideas for allowing Americans to retain their existing plans, with plans to vote on a proposal next week.
"Actions speak louder than words," said Rep. Fred Upton (R-Mich.), chairman of the House Energy and Commerce Committee, who drafted the bill. "If the president is serious about offering relief to Americans whose health plans are being canceled, then he should strongly support the Keep Your Health Plan Act."
A spokesman for House Speaker John A. Boehner (R-Ohio) questioned whether there was anything Obama could do administratively that would be legal and effective. Eligibility terms for federal subsidies are spelled out in the reform law, as are the terms of who falls under the "grandfather" clause that protects from cancellation any policy issued before the 2010 enactment of the law.
If millions more people can suddenly invoke the grandfather clause, said one analyst, that would change the assumptions insurers made when they calculated the premiums they are now offering in the marketplace.
Many of those who want to keep their plans pay very low-cost premiums because they aren't sick and don't use the healthcare system much. Those are exactly the participants the insurers are counting on joining the new insurance pools to help pay the freight for everyone else.
"If those people don't come into the pool next year, then the premiums the insurers bid for the 2014 policies might be wrong," said Gary Claxton, a vice president of the Kaiser Family Foundation.
If millions of people who have coverage now can keep it as long as they wish without complying with new rules, Claxton said, the healthiest of them will probably choose to do so — until they get sick and decide to cash in on the benefits of the new marketplace.
Obama is hoping to avoid that scenario, banking heavily on the repairs now being made to his website.
Administration officials say that once consumers can see their options, they will find there are other comparable policies available. Democratic senators at a White House meeting this week said they were left with the impression that no changes in the law would be made until after the Nov. 30 deadline for improvements to the website.
Although they have not closed the door to new legislation, White House staffers say they hope it won't be needed.
"The president did acknowledge that there are some gaps in the law that need to be repaired," White House spokesman Josh Earnest said Friday. "He has directed his team to consider some administrative solutions to those problems — some steps that his administration could take unilaterally."
Those fixes, for now, do not include an extension of the six-month enrollment period. If the contractors meet their goal for repairing the website, consumers would still have four months left to sign up for insurance. Compared with a typical open enrollment period for employer-based insurance plans, that is "a really long time," Earnest said.
Still, website problems continue to weigh on the entire law. Obama's point man on the project, former economic advisor Jeffrey Zients, said Friday that the healthcare.gov website now is providing acceptable response times for potential enrollees for stretches of time.
There are also "intermittent periods of unacceptably slow response times," he told reporters in a conference call.
Republicans on the Senate Finance Committee released a report Friday that showed there had been five enrollments on the District of Columbia exchange in the month since the Oct. 1 launch.
"There's been a whopping five people enrolled in the city's exchange. That's right, five," said Sen. Orrin G. Hatch of Utah, the top Republican on the committee. "Whether it's significant problems with the website, people being forced off the coverage they had, or skyrocketing costs, these numbers are even more proof of what a disaster Obamacare is and why it should be delayed."
Lisa Mascaro in the Washington bureau contributed to this report.
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