The Insurance Industry Is Obama's Frenemy

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After years of casting the health insurance industry as a villain, guilty of canceling plans without justification and raising premiums for profit, President Obama can't criticize them when he actually needs to. "If you like you plan, you can keep it" has been debunked, but Obama hasn't criticized insurance companies for changing plans (causing them to lose their grandfather status) or canceling them, despite calls from his supporters.

The problem is, as much as Obama has demonized the industry in the past, they're in this together for the long haul. "Their interests are aligned with our interests in terms of wanting to enroll targeted populations," a senior White House official told Politico on Wednesday. "It is not that we will agree with everything now either, but I would say for some time now there has been a collaboration because of that mutual interest." Not only does attacking the industry not help the administration's public relations problems, but insurers have been instrumental in things like hand fixing healthcare.gov applications with incomplete information. And, as an insurance industry official told Politico, the White House knew some plans would be cancelled, adding "the White House would be sh—ting on the insurance industry for continuing to offer plans that were below the threshold." 

But Obama's supporters aren't buying that. "For the life of me, I do not understand why we as Democrats are not aggressively blaming [policy cancellations] on the insurance companies," Democratic pollster Celinda Lake said on Monday. "We ought to say, 'The insurance companies are absolutely undermining [the healthcare law],' and they don't want to have policies that meet the minimum requirements and we’re not going to stand for it." And as Talking Points Memo uncovered this week, even if insurers aren't entirely responsible for canceled plans, they are responsible for misleadingly pushing customers towards their more expensive plans. In that regard there's proof, if Obama wants to use it. 

But while 2013 Obama has to play nice, 2009 Obama wasn't afraid to go there. When the industry claimed that Obamacare would drive premiums up (which is true for some people) he called their ads "deceptive and dishonest," The New York Times reported. "It’s smoke and mirrors," Obama said. "It’s bogus. And it’s all too familiar. Every time we get close to passing reform, the insurance companies produce these phony studies as a prescription and say, 'Take one of these, and call us in a decade.' Well, not this time." (Of course, Nancy Pelosi wins the prize for insurance industry bashing. In 2009 she described the industry as "immoral" and "villains.")

Now the president is only willing to criticize the industry in the past tense. During a health care reform speech in Boston last week, he referred to "bad apple" insurers and their practices before Obamacare. "Remember, before the Affordable Care Act, these bad-apple insurers had free rein every single year to limit the care that you received, or used minor pre-existing conditions to jack up your premiums, or bill you into bankruptcy," Obama said. Never mind that those "bad apples," like Humana, are still around today.

But despite what Democrats and Obamacare supporters want, it's probably for the best that the administration and the insurance industry keep this shaky frenemy alliance going. Any critiques, like this tweet sent out by White House official Valerie Jarrett:

FACT: Nothing in #Obamacare forces people out of their health plans. No change is required unless insurance companies change existing plans.

— Valerie Jarrett (@vj44) October 29, 2013

...could end up reflecting badly on the attacker. Politifact rated Jarrett's "fact" false. 

This article is from the archive of our partner The Wire.