On Friday, President Barack Obama used the long-awaited resignation of Secretary of Health and Human Services Kathleen Sebelius to claim victory for his namesake health law. “She got it fixed, got the job done,” he said. Don’t believe him.
The law is called Obamacare, not Sebeliuscare. And sadly, there is plenty of trouble ahead. Aside from the website fiasco, few of Obamacare’s problems are owing to Sebelius alone. They are either baked in the law or caused by the hard-sell way the president has coaxed — and even lied to — unsuspecting Americans in an attempt to get them signed up for government exchanges.
At Friday’s Rose Garden announcement, Obama claimed that 7.5 million people have enrolled in affordable health coverage. The truth is that only 80 percent have actually paid their first premium and therefore have coverage, according to estimates by RAND Corporation and Goldman Sachs. But the more important issue is how many will continue paying. Obamacare purchasers living paycheck to paycheck will be shocked by the high deductibles, about $3,000 for the silver plan (most commonly selected) and $5,000 for the bronze plan (most affordable). Millennials who heard the president say on the comedy skit “Between Two Ferns” that they can buy a health plan for the price of a cellphone contract won’t be laughing when they realize what a $5,000 deductible means. Who ever heard of a cellphone contract with a $5,000 deductible? They’ll have to pay out of pocket for thousands of dollars worth of care before they see benefits from Obamacare. Some will stop paying premiums. The American Medical Association, a chief Obamacare booster, is so worried about this that it’s sending warnings to its members.
Section 1412 of the health law gives consumers a 90-day “grace period” before their subsidized plan is canceled for nonpayment. But insurers only have to continue paying doctors and hospitals for 30 days. The next 60 days of care are on the doctor or hospital. The AMA says that “it could pose a significant financial risk for medical practices.”
Consumers reeling from Obamacare-premium shock are in for another jolt when the 2015 rates come out. Overall, consumers had to pay 41 percent more for individual plans in 2014, according to the Manhattan Institute, and in some states (Delaware and New Hampshire), rates went up 90 percent or even 100 percent, according to a newly released Morgan Stanley analysis. Insurance executives already are warning about double- or triple-digit hikes for the coming year. “I do think it’s likely premium rate shocks are coming,” said Chet Burrell, CEO of Care First BlueCross BlueShield. Aetna CEO Mark Bertolini, one of the first to raise the alarm, said increases “could go as high as 100 percent.”
In most states, insurers will be setting their 2015 rates in June, but the administration is doing everything possible to keep these future rates under the radar until after the November midterm elections. They even postponed the beginning of the open-enrollment period until Nov. 15.
LOSING ON-THE-JOB COVERAGE
But there’s no way to hide the impact on the 25 million to 30 million Americans who could lose on-the-job coverage in the coming months. Employers who bought plans in the small-group market last year will have a hard time renewing those old plans and will have to choose between providing the more costly Obamacare benefit package or dropping coverage altogether. Count on employers with low-wage workforces, such as retailers, hoteliers and restaurateurs, to push their employees and families into the exchanges.
FIGHTING FOR CANCER CARE
Cancer is most Americans’ No. 1 health fear. And access to the nation’s best-known cancer centers is becoming a hot-button issue, as Obamacare enrollees discover how few choices of hospitals and doctors they have. Many plans exclude specialty cancer hospitals, even though research shows that women with ovarian cancer, for example, live a year longer when they are treated at high-volume cancer hospitals instead of local facilities. Insurers say they will have to raise premiums for exchange plans even higher if the outrage over access forces them to cover cancer hospitals.
The president said on Friday that Obamacare has “turned the corner.” Not exactly. In fact, even the confirmation of Sebelius’s successor, Sylvia Mathews Burwell, current director of the White House Office of Management and Budget, will not be an anointing. The U.S. Senate confirmed Burwell unanimously for her present position, but already Senate Minority Leader Mitch McConnell, R-Ky., has fired a shot, saying he hopes her appointment “will be the start of a candid conversation about Obamacare’s shortcomings.” That could take a while.
Betsy McCaughey is a former lieutenant governor of New York and the author of “Beating Obamacare.”