What Obama Really Meant When He Said 'If You Like Your Plan, You Can Keep It'

Here's What Obama Really Meant When He Said 'If You Like Your Plan, You Can Keep It'

Way, way back before time itself began, President Barack Obama said these words, in reference to the Affordable Care Act: "If you like your plan, you can keep it." And then, as Daily Intel's Dan Amira pointed out Tuesday, he said it a bunch more times!

Well, the news today is that lots of people aren't going to keep the plans that they are on, and are receiving notice from their health insurance providers that they will be shunted onto different, perhaps more expensive plans. And they no likey. But the White House is furiously pushing back, all the same.

So what gives? Well, to answer that question we have to go to Spin School, and re-examine this line, "If you like your plan, you can keep it." At first blush, it seems pretty straightforward. As with any political quip, however, it sort of contains multitudes. But, to begin with a bottom line, the answer to the question of, "Is this still a true statement?" is basically, "Kind of?" But the words "plan" and "like" are doing a lot of heavy lifting to make that possible.

Let's begin with the whole notion of continuity -- the literal truth about whether a "plan" that you currently have can be "kept." One of the provisions in the Affordable Care Act is a grandfathering clause, intended to exempt the employer-sponsored insurance plans that were in existence at the time of the Affordable Care Act's passage from having to follow the contours of the Affordable Care Act. The problem with the line, "If you like your plan, you can keep it," is that it suggests that what's being grandfathered, here, is the customer's possession of a plan. But what was actually grandfathered were the plans that existed at the time, themselves.

What that means is that everyone could retain their plans so long as no alteration was made to those plans by their providers. However, the very minute a provider made a tweak to those plans, they lost the grandfather protection, and compliance with the Affordable Care Act's new standards became necessary.

There was actually a big fight about this back in September 2010. At that time, the Department of Health and Human Services was pretty forthright about what was likely to happen. As Julian Pecquet of The Hill reported back in 2010:

The Department of Health and Human Services released preliminary regulations in June. They state that plans would lose their grandfathered status if coinsurance and copayments increase more than a specified amount, for example.

According to HHS estimates:

--40 percent to 67 percent of individual policies will lose grandfathered status by 2011;

--34 percent to 64 percent of large employer group plans (100 or more employees) will lose their grandfathered status by 2013: and

--49 percent to 80 percent of small employer group plans (three to 99 employees) will lose their grandfathered status by 2013.

In other words, your plan is grandfathered in unless your insurer explicitly makes it worse by jacking up your deductible or otherwise monkeying with your coverage in an attempt to screw you, which is the basic stated business model of insurance companies.

So, you were warned, but you were warned very quietly. And as time passed, that warning did not manage to garner the same amount of attention as, "If you like your plan, you can keep it."

Nevertheless, when you hear the words, "If you like your plan, you can keep it," do you immediately think to yourself, "Of course by that they mean I'll keep my plan provided that, say, my copayment never changes?" No, you don't. You are a normal human being, accustomed to straightforward-sounding things meaning what they seem to imply.

The other part of the sentence that's sitting there trying to be all razzle-dazzle instead of attaching itself to its simple meaning is the word "like." A lot of people like their health insurance plans for different reasons, but one primary reason so many people "like" their plan is that they like the low, low price of the premium. Of course, as they say, "You get what you pay for," and the insurance market is no different.

There are many insurance plans with eminently likeable costs that are not so likeable once you start using the plan. Some cheap plans offer only high-deductible catastrophic coverage. Other cheap plans have lifetime caps on coverage -- which means that if you suffer a major injury or illness that requires long-term or very costly medical care, your insurance company is eventually going to hit the cap and leave you holding the bag and facing the prospect of disastrous debt.

The Obama administration's argument here basically boils down to, "Well, you shouldn't like those plans!" And, indeed, one of the reasons the Affordable Care Act exists in the first place to reform the insurance market so that plans like this no longer exist.

Over at The Washington Post, Erik Wemple takes on the curious case of Dianne Barrette, who is this minute's poster child for the evils of Obamacare:

More coverage may provide a deeper understanding of the ins and outs of Barrette’s situation: Her current health insurance plan, she says, doesn’t cover “extended hospital stays; it’s not designed for that,” says Barrette. Well, does it cover any hospitalization? “Outpatient only,” responds Barrette. Nor does it cover ambulance service and some prenatal care. On the other hand, says Barrette, it does cover “most of my generic drugs that I need” and there’s a $50 co-pay for doctors’ appointments. “It’s all I could afford right now,” says Barrette.

In sum, it’s a pray-that-you-don’t-really-get-sick “plan.”

If this woman had a serious ailment and was forced to stay in the hospital for a while, her old plan would have likely destroyed her financial life permanently, leaving her bankrupt. Now, thanks to “Obamacare,” in the event of a disaster, she’ll be protected with coverage her insurer can’t take away -– with no annual or lifetime caps.

In other words, the new horror story for critics of the health care law features a middle-aged woman trading a bad plan for a good plan, and health care insecurity for health care security.

What’s more, while much of the coverage of Barrette’s situation has focused on the higher monthly cost of her new, better insurance plan, there’s another detail that’s been overlooked by some: she’ll be eligible for subsidies under the Affordable Care Act. The cost of the coverage isn’t what she’ll actually have to pay out of her own pocket.

Yeah, you see, that's sort of the whole point of the Affordable Care Act -- it creates health insurance exchanges where people who find themselves in this situation can get relief from situations like this, obtaining health insurance at competitive prices that offer more bang for the buck and remove the worry of people falling into crippling indebtedness because of that one time they really, really didn't want to die.

Nevertheless, if you are someone who's received notice that you are losing your insurance coverage, that's a traumatic thing to experience, even if your insurance coverage is objectively terrible.

And you know, the one thing that would really help people in that situation, and the Obama administration itself, would be, say ... a fully functioning website on which normal human Americans could sign up for health care coverage on the exchanges. If such a thing existed, many if not all of these "I got screwed by my health insurance provider, thanks Nobama!" stories could be easily parried. Unfortunately, that fully functioning website does not yet exist.

Even still, the phrase "If you like your plan, you can keep it" tends to suggest that there will be some widespread, "keeping" of plans. This turns out not to be the case. Nevertheless, the Obama administration can argue that all of this was well known before now. As Jonathan Chait points out:

Obama’s promise that people could keep their insurance was intended to convey that those who already had insurance through their job or through Medicare would not be forced into the new health-care exchanges.

On the one hand, this failed to convey the blunt reality that people in the individual insurance market who had skimpy coverage and wanted to keep it could not. On the other hand, the administration never denied this fact. The designers of Obamacare straightforwardly believed that the regulation of the individual-health-insurance market was fully consistent with its promise, even though people already in that market were bound to face changes.

In some respects, the rules appear to fall short of the sweeping commitments President Obama made while trying to reassure the public in the fight over health legislation.

In issuing the rules, the administration said this was just one goal of the legislation, allowing people to “keep their current coverage if they like it.” It acknowledged that some people, especially those who work at smaller businesses, might face significant changes in the terms of their coverage, and it said they should be able to “reap the benefits of additional consumer protections.”

Still, we are left with this phrase, "If you like your plan, you can keep it," that probably should have come with a bit of fine-print reading, "Some restrictions apply, void where prohibited."

One thing that's worth wondering about here is whether the media's overarching attention to finding some cheap gotcha moments to bedevil political figures for a newscycle or three doesn't end up adding to the confusion. After all, the circumstances that are driving today's crisis-cycle were all things that were reported back in 2010. There has been a more than adequate period of time to ask more significant questions about the president's quip, and to instruct the public as to what was coming, in the service of keeping the populace informed and prepared.

Nevertheless, the simple fact of the matter is this: To any normal person, making the tacit assumption that words don't have any hidden meanings or exceptions, "If you like your plan, you can keep it" sounds like a pretty clear, right-to-the-point certainty on which one should be able to rely. When that sentence lands in the ear of a normal human being, it conveys the promise of continuity, and relief from any shocking news about losing one's coverage.

That promise has been broken, and now, the White House has to reel and offer some sputtering explanation as to how the promise is actually being kept, as long as you hear that sentence in a different way. Sure, yes, there were some news stories that served as the harbingers of today's bad news, but "If you like your plan, you can keep it" was uttered again and again, in spite of this.

I get why the administration wanted to utter this glib pronouncement. "If you like it, keep it." It's simple, to the point, easy to understand, and ready-made for our sound-bite age. In that way, the quip is very much unlike Obamacare, and much more like the plan that was never considered -- single payer. With Medicare for all, you pay taxes and the government covers your medical bills. That's it. No websites, no marketplaces, nothing fancy that's sure to break.

But hey, live by the glib pronouncement, die by the glib pronouncement.

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