Some news reports and conservative blogs have characterized the government’s new regulations about how insurers can preserve their so-called “grandfathered status” — under which they will be exempt from some of the law’s benefit standards and regulations — as a departure from President Obama’s promise that if you like the coverage you have, you can keep it:
- NY POST: Bottom line: Sebelius means to dictate what your insurance plan must look like almost from day one, no matter how you get your coverage.
- HOT AIR: Their strategy for letting you keep your plan if you like your plan is to include a “grandfather clause” that would exempt current plans from consumer protection requirements so long as copayments and deductibles are below certain limits. The problem: If your insurer alters the terms of the plan in the normal course of business and those limits are crossed, it’s no longer a grandfathered plan and the new consumer-protection benefits suddenly become mandatory — which means an exciting new monthly premium when your insurer inevitably passes the costs of those benefits on.
- INVESTORS BUSINESS DAILY: Internal administration documents reveal that up to 51% of employers may have to relinquish their current health care coverage because of ObamaCare. Small firms will be even likelier to lose existing plans.
If you’re “keeping a plan you like,” you like it because you believe it works. It offers the right benefits for the right price. If employers or insurers violate the grandfather protocols, they’re either slashing your benefits or jacking up your deductibles or co-payments. They’re tipping the balance in the cost-to-benefit ratio and selling you a faulty product; you’ll pay dearly once you need to actually use the coverage you thought you liked.
In the same way that the government requires automakers to meet certain safety standards and design specifications, insurance issuers and employers will have to abide by new benefit and consumer protection minimums. They shield consumers from drastic benefit cuts or cost shifts. And by discouraging insurers and employers from making these changes, the new grandfather regulations help you like what you have.