The latest noisy controversy in the rollout of Obamacare is over millions of citizens being moved out of plans they purchased on the individual market. Even doggedly liberal commentators are attacking the administration for misleading these customers into thinking they could keep their exact same plans under Obamacare. But while the politics may be bad, the demise of these plans has been long expected as part of a wave of rationalization and creative destruction in the existing private-sector market.
In some cases, insurers are dropping policies because it is no longer profitable to offer them once they have to meet higher standards under the Affordable Care Act, such as accepting those with pre-existing conditions and actually covering outlays when people get sick. In other cases, as in Pennsylvania, it is the sickest people being dropped, as insurers get rid of their individual-market "guaranteed-issue" plans for people with pre-existing conditions now that all plans have to accept those who have them.
In all cases, there's been no move by the federal government specifically to help the 15 million people in the individual insurance market move into new plans that serve their needs and keep their costs low as new options become available through the state-based exchanges. Between 40 and 67 percent of the old individual-market plans are expected to be affected by the new rules, NBC reports. Meanwhile, insurers have been offering to auto-enroll customers in new plans that are much more expensive than the old ones, sparking outrage. So far more than 2 million people in the individual insurance market have received notices that they need to get or accept new plans over the course of 2014, according to CBS.