By Karen Pallarito
THURSDAY, Nov. 14 (HealthDay News) -- Bending to political pressure, President Barack Obama on Thursday announced a plan to allow Americans to keep their health insurance plans for another year, even if that coverage would have been cancelled because it fails to meet new rules under the Affordable Care Act.
Under Obama's plan, health insurers may renew health plans that fail to meet the controversial health law's stricter standard, but only for existing customers.
State insurance commissioners will have the final word on which plans can and cannot be sold in their states, Obama said during a White House briefing.
"The bottom line is insurers can extend current plans that would otherwise be cancelled into 2014, and Americans whose plans have been cancelled can choose to re-enroll in the same kind of plan," Obama said.
The White House proposal comes as the House of Representatives prepares to vote Friday on a bill sponsored by Rep. Fred Upton (R-Mich.) that would allow everyone to buy those older policies, not just existing customers.
House Minority Leader Nancy Pelosi (D-Calif.) said such legislation would be "completely disruptive."
In recent weeks, millions of Americans with health policies that they had purchased through the individual insurance market have received notices that their coverage would be cancelled effective Jan. 1. Many of these health plans fail to meet new standards under the health-reform law -- sometimes called Obamacare -- that requires plans to cover a standard set of health benefits.
News of the policy cancellations roused ire on both sides of the political aisle, fueling a bipartisan backlash against the President whose promise that Americans could keep coverage they liked turned out not to be true.
"I completely get how upsetting this can be for a lot of Americans, particularly after assurances they heard from me that if they had a plan that they liked, they could keep it," Obama said. "And to those Americans: I hear you loud and clear," he added.
Under the proposed change, health insurers must tell customers what protections the renewed plans don't include and inform people of health insurance options through the new online marketplaces created by the Affordable Care Act.
"This fix won't solve every problem for every person," Obama said, "but it's going to help a lot of people."
Republicans, who have fought against the health-reform law since its passage in 2010, were unimpressed with Obama's proposal.
House Speaker John Boehner said it was time to "scrap this law once and for all."
"You can't fix this government-run health care plan called Obamacare. It's just not fixable," he added, according to the Associated Press.
The proposed change to the health law comes as the Obama administration works to regain credibility after the disastrous launch of the new online federal health marketplace -- or exchange -- where consumers may buy health insurance, in many cases with the help of federal tax credits.
"That's on me. We fumbled the roll-out on this health-care law," Obama said Thursday, adding that he's confident that next year people will look back and find that the new law is working well.
In addition to fixing the HealthCare.gov website, Obama said his administration would be taking steps to make the process of purchasing health insurance simpler by streamlining the application process, giving people more assistance and communicating people's health-plan options in a clear way.
In response to Obama's remarks, America's Health Insurance Plans, an insurance trade association, issued a statement saying that consumers may still face higher premiums.
"Changing the rules after health plans have already met the requirements of the [health-reform] law could destabilize the market and result in higher premiums for consumers," AHIP president and CEO Karen Ignagni said in a news release. "Premiums have already been set for next year based on an assumption of when consumers will be transitioning to the new marketplace.
"If now fewer younger and healthier people choose to purchase coverage in the exchange, premiums will increase and there will be fewer choices for consumers," she added. "Additional steps must be taken to stabilize the marketplace and mitigate the adverse impact on consumers."
Ignagni said that the "only reason consumers are getting notices about their current coverage changing is because the ACA [Affordable Care Act] requires all policies to cover a broad range of benefits that go beyond what many people choose to purchase today."
Obama's proposal Thursday followed the White House's release late Wednesday of a report revealing a disappointing number of health plan enrollments through the new federal and state online insurance exchanges.
Just over 106,000 Americans enrolled in health plans through the new marketplaces from Oct. 1 through Nov. 2, U.S. Health and Human Services Secretary Kathleen Sebelius said during a news conference.
That figure includes people who have not yet paid their health-plan premium and, of those, only 26,794 enrolled through the troubled federal health marketplace HealthCare.gov.
Another 975,000 people have applied for coverage and received a determination of eligibility for coverage "and are currently still shopping for a plan," Sebelius said.