Obama blames 'bad apple' insurers for canceled coverage


* "Shop around" says Obama, "get a better deal"

* Obama: won't go back to previous broken health system

* NBC/WSJ poll shows Obama approval rating at new low

* HHS' Sebelius: HealthCare.gov wasn't ready, "I was wrong"

By Roberta Rampton and David Morgan

BOSTON/WASHINGTON, Oct 30 (Reuters) - President Barack Obamasaid on Wednesday that "bad apple" insurance companies, not hissignature healthcare law, are to blame for hundreds of thousandsof people losing their coverage in the past few weeks.

As administration officials scrambled to fix technicalproblems on an online insurance marketplace that is central tothe success of the Affordable Care Act, Obama blamed privateinsurers for a separate problem that has critics questioning hishonesty.

The president has repeatedly promised that people who arehappy with their health plans would not have to change coveragebecause of the law, known as Obamacare.

But the termination of individual policies has given hisRepublican opponents additional ammunition to criticize theprogram they have tried to stop since its inception in Obama'sfirst term.

Republicans' assertion that Obama had broken a major promiseto the electorate is potentially more damaging than theglitch-ridden website rollout on Oct. 1.

Obama's approval rating hit a new low in a NBC News/WallStreet Journal poll issued on Wednesday, a result the pollstersattributed to multiple setbacks including the Obamacareproblems.

The law requires insurers to offer a higher level of minimumcoverage that includes maternity care and mental healthtreatment, among other benefits. Individuals who do not havepolicies that meet the new standards may see their coveragecanceled at the end of the year, or may find that the monthlypayments are beyond what they can afford.

Speaking in Boston, Obama said those who are getting droppedwill be able to find new options through the online insuranceexchanges, or marketplaces, established under the 2010 law.

"Just shop around in the new marketplace," he said. "You'regoing to get a better deal."

He also stressed that the law allows Americans to keepbare-bones plans created before the law was signed, as long asinsurers did not change or cancel them.

"Remember, before the Affordable Care Act, these bad-appleinsurers had free rein every single year to limit the care thatyou received, or used minor pre-existing conditions to jack upyour premiums, or bill you into bankruptcy," Obama said.

America's Health Insurance Plans, the national trade groupfor insurers, when asked for comment, pointed to its prior factsheets about which plans are protected.

"Most policies in the individual market are not'grandfathered' and therefore have to come into compliance withthe ACA requirements starting on January 1, 2014 or when thosepolicies renew throughout the year," one document said.


The law is the most sweeping new social program since thecreation of Medicare and Medicaid in the 1960s.

It is intended to move the United States closer to the goalof universal care by using market-based mechanisms to deliveraffordable insurance to less affluent families that have beenpriced out by decades of rising healthcare costs.

Obama said he would not allow the country to return to theprevious system, which gave insurers wide latitude to refusecoverage to consumers that they did not deem profitable.

"I don't think we should go back to the daily cruelties andindignities and constant insecurity of a broken healthcaresystem," he said.

Technical woes, however, have prevented millions ofAmericans from exploring those options through the government'sHealthCare.gov portal since it was unveiled.

On Capitol Hill, Obama's top health official called thedebut a "debacle" as she sought to assure skeptical lawmakers ata congressional hearing that the administration would eventuallyget the portal to work smoothly.

HealthCare.gov was down over the course of the four-hourhearing.

"Hold me accountable for the debacle," Health and HumanServices Secretary Kathleen Sebelius told the U.S. House ofRepresentatives Energy and Commerce Committee.

"I told the president that we were ready to go. Clearly Iwas wrong," she said.

The security of the site was at "high risk" because of alack of testing before it opened for enrollment, according to agovernment memorandum reviewed by Reuters.

Sebelius said HHS is conducting weekly security tests toensure visitors are protected.

She has drawn intense criticism from Republicans, who havecalled for her or other senior officials to resign. She seemedto survive the high-profile hearing without further damage. AWhite House spokesman said after the hearing that Obama has"complete confidence" in Sebelius.

Republicans have sought to derail the healthcare overhaulsince Obama took office in 2009, culminating in a 16-daygovernment shutdown this month that has cost the U.S. economy anestimated $24 billion, according to Standard & Poor's ratingsagency. Republicans say the program is an unwarranted expansionof the federal government.

The website's woes and insurance plan terminations havegiven Republicans more ammunition.

"For those who lose the coverage they like, they may also belosing faith in their government," said Michigan RepresentativeFred Upton, the Republican who oversaw the hearing.

Several Republican senators introduced legislation thatwould allow insurers to sell more plans that are not compliantwith Obamacare. "One of two things is true here - eitherPresident Obama was being dishonest or he was disengaged onceagain," Republican Senator Ron Johnson of Wisconsin said at anews conference.

Despite the drama, the public's assessment of Obamacare hasshifted little over the past months. Gallup reported that 36percent of Americans believe it will make healthcare in theUnited States better, while 44 percent think it will make thingsworse - essentially the same as surveys found in August andJune.

But the NBC News/Wall Street Journal poll found Obama'srating fell to just 42 percent of Americans approving of his jobperformance, down 5 percentage points from earlier this month.

The pollsters attributed the decline to an accumulation ofsetbacks including allegations of spying by the NationalSecurity Agency, the recent government shutdown and thehealthcare problems.


The growing crisis surrounding Obama's signature legislativeachievement could diminish his influence in Congress andthreaten his other priorities like immigration reform signedinto law in his remaining three years in office.

U.S. presidents have a limited time to enact their agenda inthe second term before they start losing influence as lawmakersstart worrying about re-election.

Obama spoke at Boston's historic Faneuil Hall, where in 2006then-Governor Mitt Romney, a Republican, signed a state law thatserved as a model for Obama's health reforms.

Like Obamacare, that law had a rocky start - state officialsdelayed some aspects for several months, and the White Housesays only 123 people signed up in the first month it wasavailable. By the end of the year-long enrollment period, 36,000had signed up.

The Obama administration likewise expects "a very smallnumber" of people to sign up initially for coverage, Sebeliussaid. Overall, U.S. officials hope 7 million people sign up inthe first year.

The White House has declined to say how many Americans haveenrolled so far. It also has asked states that run their ownonline healthcare exchanges to stop releasing their own data,according to Kevin Counihan, who runs Connecticut's health site.

"The White House is coordinating this stuff and trying toget states to report when they report - once a month," Counihantold reporters. "We'll do it every two weeks."

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