The author says 'the effects of the recent cancellations are not necessarily out of the norm.' Study probes ACA impact on plans

Millions of the plans that were canceled because they did not meet Affordable Care Act requirements probably would have been canceled anyway — by the policyholders, a new study suggests.

Last fall, as cancellation letters arrived in mailboxes around the country, opponents of the law cited them as evidence that President Barack Obama lied to Americans when he promised, “If you like your health care plan, you can keep it.”


But most individuals who lost plans probably would not have continued them even without the law, according to the study, which was published online Wednesday in Health Affairs. Its author questions whether those cancellations contributed much to the nation’s ranks of short-term uninsured.

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The study looked at people who bought nongroup, or individual, insurance plans — a market that was relatively unstable even before Obamacare took effect. Between 2008 and 2011, fewer than half the people who started out with such coverage still had it after a year. And 80 percent of those who changed policies had a new plan within a year, usually through an employer, the study found.

Given this baseline, author Benjamin Sommers says, “the effects of the recent cancellations are not necessarily out of the norm.”

An estimated 10.8 million people had nongroup coverage in 2012, according to the Congressional Research Service. Based on his own findings, Sommers estimated that 6.2 million Americans leave nongroup coverage each year under typical circumstances. News reports that as many as 4.7 million adults had their policies canceled in 2013 “are likely capturing a great deal of the normal turnover in this market,” he concludes.

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Writing in Health Affairs, Sommers says his examination of data from the Census Bureau’s Survey of Income and Program Participation showed that nongroup coverage is transitional for most people. They often buy it while between jobs or waiting for employer benefits to kick in. A year after dropping their individual plans, Sommers found, 50 percent had employer-sponsored insurance, 20 percent had reacquired nongroup coverage, 6 percent joined Medicare or Medicaid, and 4 percent had other coverage.

However, Sommers did identify a group most likely to face a genuine, unwanted disruption from the ACA’s requirements: white, self-employed Americans of ages 36-64. They were likely to maintain their nongroup coverage for three years or more.

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Young adults of ages 19-35 were unlikely to fall in that same category, with only a third holding nongroup coverage for at least 12 months.

About 65 percent of people with nongroup plans had incomes below 400 percent of poverty, so “many, if not most” of those whose plans were canceled last fall are now eligible for subsidies, Sommers writes.

Sommers, an assistant professor at Harvard University’s medical and public health schools, serves as a part-time adviser in the Office of the Assistant Secretary for Planning and Evaluation at the Department of Health and Human Services.