One Million People to Lose Health Plan

People were told if they liked the health plan they have, they can keep it. But that appears not to be the case. Come September, more than 1 million people with “limited-benefit” health plans could join the ranks of the uninsured. Limited benefit plans — sometime called mini-meds — have much lower premiums because potential claims are capped at lower levels than traditional plans and there are often limits on physician visits and drug benefits. Under the new health reform law, insurers will no longer be allowed to offer annual limits on claims in return for lower premiums. Even though the individual mandate is not slated to begin until 2014, many of the low-cost plans will disappear long before then.

Comments (11)

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  1. Vicki says:

    I find this revelation stunning. How many times have we heard Barack Obama say “If you like your health plan you can keep it.” Can the law of fraud be applied to presidents? I think it should. Can’t decide whether this is civil fraud or criminal fraud, however.

  2. Ken says:

    On Obama Care, every week brings a new surprise.

  3. Neil H. says:

    This is going to be a big deal. I suspect that the vast majority of these people are Obama voters — if they vote at all.

  4. Devon Herrick says:

    Proponents often claim annual limits on benefits are “arbitrary” and hurt very sick people. This argument makes sense to consumers who do not understand the market for risk.

    Pure insurance is little more than a transfer (and pooling) of risk in return for a monthly premium. What consumers often don’t understand is that the annual limits and lifetime limits on benefits are not arbitrary. Rather, the limits are a stop loss provision that reduces risk to the underwriter. BY reducing the insurers risk you reduce the insured’s premium. Banning annual or lifetime caps on benefits forces people to pay higher premiums.

    This is not news to proponents — they knew all along there was a whole universe of people who would be forced to switch coverage. The underlying purpose was to increase cross-subsidies by forcing people into policies with no cap on benefits.

  5. Linda Gorman says:

    When these plans go away the insurers will be blamed, for caring more about profits than people. ObamaCare will be the plan that rides to the rescue, saving those with low incomes from the heartless private sector.

  6. Don Levit says:

    Devon described the problem very well.
    “No limits” seems to be the new mantra.
    “How dare you say no to me and my medical problems!”
    What is not said, in between the lines “I don’t give a damn about anybody else in the pool, or what my reimbursements do to your premiums!”
    Don Levit

  7. Stephen C. says:

    I think this is going to create a serious political problem for congressional Democrats.

  8. Cindy H. says:

    How long will we have to wait until Obamacare is going to explain their way out of this by blaming the insurance companies?

  9. Bart Ingles says:

    Proponents often claim annual limits on benefits are “arbitrary”…

    …And so naturally the answer is to arbitrarily remove all limits. It sounds to me like a variation of the round-number fallacy.

  10. Bruce says:

    This is the government saying: if you don’t have (or can’t afford) the type of insurance we want you to have, it’s better for you to have no insurance at all.

  11. [...] September, between 1 million and 2 million people with limited benefit insurance are likely to lose coverage because their insurance doesn’t comply with the “no [...]