The Obama administration said Wednesday that insurers can
wait until 2016 before canceling plans that don't comply with Obamacare.
The administration released a host of final regulations
that, among other things, ease reporting requirements for businesses and allow
insurers to keep selling individual policies that don't meet the law's
requirements. Those plans, which the White House first uncanceled in November,
can now last until 2016 or, in some cases, 2017.
Amid an uproar from congressional Democrats, President Obama
first announced in November that he would let states and insurers decide
whether they wanted to uncancel plans that don't cover everything the
Affordable Care Act requires. But that one-year transition set up another round
of cancellation notices for this October—just before the midterm elections.
Under the additional extension announced Wednesday, those
cancellation notices will come in October 2016, although plans that offer early
renewals could be extended into 2017. The administration doesn't expect many
people to be affected at that point.
Administration offiials denied any political motivation for
the latest delay, though press materials about the changes specifically
name-checked Democratic senators who are up for reelection this year and have
pushed for Obamacare changes—including Mary Landrieu, Jeanne Shaheen, Mark
Udall, and Mark Warner.
Uncanceling pre-Obamacare plans has a small but negative impact
on the law's insurance exchanges, the new marketplaces where individuals who
buy insurance on their own can shop for coverage.
The people most likely to hang on to a plan that doesn't
meet all ACA requirements, rather than switching to an Obamacare-compliant
policy, are typically healthy and reasonably affluent. Allowing those consumers
to stay out of the exchanges carries some risk of higher premiums next year if
those inside the new marketplaces are sicker than expected.
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