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President Obama to Announce One-Year Extension on Some Health Plans, Avoid Plan Cancellations

Aired November 14, 2013 - 11:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, CNN ANCHOR: Those numbers were low, compared to what had been expected.

That's a fraction of what the administration was hoping for, and only about a fourth of the new enrollees signed up through the trouble- plagued federal Web site healthcare.gov. The president is due to speak in about half an hour or so from the White House. We'll have live coverage.

Let's get some specific details, though, of what's going on. Our chief congressional correspondent Dana Bash is up on Capitol Hill, learning some of the details. The president getting ready to make these announcements, Jim Acosta will pick it up, also from the White House. Gloria Borger is here.

Dana, first to you, what do we know?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, Wolf, we know from a source familiar with what the president is going to announce, that he is going to say that people who got cancellation policies will be told by their insurance companies that they can keep their policy.

These are only people in the individual market and it would only be allowed for one year. And that is a key one year. I'll get back to that in a minute, why, in a bit.

But the other key point I'm told by this source is -- a couple of sources now -- is that these insurance companies, if they're saying to a consumer, you can renew this canceled policy, they're going to be required to tell them a couple of things.

Number one, that there are other options out there for them that might be better for them and, number two, that what they are going to keep will not necessarily have the benefits of other policies, meaning the benefits that are now required under the ObamaCare law, which is why many of these policies were canceled in the first place, because they're not up to snuff.

And the other thing we're hearing is that state commissioners, insurance commissioners, may be able to opt out of this. It will give the states the right to opt out of this, which is an interesting caveat here.

But I was told this, we first reported this earlier today by a source familiar with this, and in the context of this is a lot of pressure here on Capitol Hill from constituents who are getting these calls, getting these letters, saying these policies are canceled.

We don't know what to do because we can't get on the ObamaCare Web site and a real panic.

So that panic turned into pressure and frustration, being voiced in a very aggressive way, we've been told and have been reporting for the past couple of days, by congressional Democrats to the White House, saying, you've got to do something.

You've got to help us fix this, because they had a de facto deadline of tomorrow, because there is a key vote tomorrow in the House.

Republicans have their own plan, which is broader, which Democrats think will dismantle this.

One thing I do want to add, since we reported the details of what the president is going to announce, administratively, our Deirdre Walsh is hearing that, even though this will be administrative, it will be administrative, Democrats in the House are talking about having their own vote tomorrow, because they're going to be forced to vote on a Republican plan, having their own vote tomorrow so that they can say that they voted for something, so they can't be hit by Republicans saying, look, this vote is up there and they voted no.

They want to have a yes vote to take home to their constituents and to take home to hit back against their political opponents, most importantly.

BLITZER: Dana Bash, breaking the news a while ago on some of the specifics of what the president will announce at the bottom of the hour from the White House, a dramatic announcement, a delay of a year -- of a year -- for some of these plans.

The president had earlier said, if you like your plan, you can keep it. That didn't work out for millions of Americans. Now he's saying we're going to try to find a way to fix it. Dana broke the story here on CNN.

Let's go over to the White House. Jim Acosta is standing by over there. What are they saying over there, Jim?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Very little on the record at this point, Wolf.

And what we can tell you is that from everything we're gathering from administration officials, nobody is really pushing back or arguing with what you're hearing from Dana Bash about some of these administrative fixes.

And this is a political fix, Wolf. Don't look past that one, because this president has seen a major hit in his approval numbers and in other important poll numbers in recent days on the question of his honesty and trustworthy.

There was a poll that came out in the last 24 hours that suggested that the president was really upside down, 52 percent of the American people saying that they don't think the president is honest and trustworthy.

And a lot of that, of course, stems from that pledge that he made, if you like your plan, you can keep it, and all those cancellation notices that have been coming in from across the country.

One interesting thing to note about some of the reporting that you're hearing from Dana Bash is that a lot of it matches some of the proposals that were being laid out by Senator Mary Landrieu, an endangered Democrat up for reelection next year. She was talking about some of these ideas.

It seems, though, what the White House decided to do was that obviously this was probably not going to get through the Congress. Republicans were already starting to say that they didn't like the Mary Landrieu plan.

And so the fact that the administration is trying to do this internally, administratively, is a sign of the political reality up on Capitol Hill that, if they were to pursue a legislation fix, it would have been next to impossible.

Now, the president, you're right, Wolf, will be out here in about 30 minutes from now. We're going to hear from him in the briefing room.

Not clear whether or not he will take questions, but make no mistake, Wolf, because of the details of this plan and because it seems, as Dana has been reporting, that there may be potential loopholes in there for the insurers not to provide all of these old plans back to consumers for people who are getting these cancellation notices, the president will be peppered with questions, whether or not he takes them at this event in just about half an hour from now.

Wolf?

BLITZER: We'll see if he sticks around and answers reporters; questions. He is coming to the briefing room, and that's what we anticipate.

Hopefully, the president will answer some questions after he makes his announcement on this delay of at least part of the Affordable Care Act, one year delay.

All right, Jim Acosta, I know you're going to be there. Stand by for that.

Gloria Borger is watching what's going on, our chief political analyst. Gloria, you know, it's going to be interesting to see how the insurance companies react.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Oh, yes.

BLITZER: So let me just review right now what we know. This is what we're hearing. Dana has been reporting it. I've got my own reporting.

And the four basic points I'm hearing that the president will make is, one, that these insurance companies may now be able to do what they couldn't do before, renew what are called these noncompliant plans for the year 2014, for a year, for those people who had those policies and liked those policies and would like to see them renewed, even though they've already received letter that they were canceled.

The insurance companies, though, in order to do this, they have to notify all of these policyholders who might be able to get their old plans back, that there is alternative coverage opportunities available through the exchange. The benefits may be better for them.

They will be losing --

BORGER: Right.

BLITZER: -- some benefits, but that's what they have to notify them that.

There will be no new people who will be eligible for what are called these old, noncompliant plans.

And this is the wild card, and I want you to weigh in on this, Gloria. State insurance commissioners, they can veto. They can veto all of this if they want to, which would throw a huge monkey wrench into this so-called fix, wouldn't it?

BORGER: You know, it would, Wolf. And in talking to sources throughout the insurance industry, what I'm hearing this morning is that they're really worried that this could throw the whole paradigm into kind of a death spiral.

Because the worry is, of course, that if the individuals who got these notices about cancellation decide then, OK, I'm going to keep this policy for another year, then the worry is that you keep those people who might be young and healthier people, starting out in their careers, you would keep them out of the risk pool for the Affordable Care Act.

And that would really be a problem for the administration as it struggles to get the Affordable Care Act going, because those are the exact people you need in the risk pool to make the plan work.

And the other worry from the insurance industry is that this, in the end, will have a bad impact on the cost of policies. And what you will see is that policies will start to go up. The cost of them will start to go up in the future.

And I would add, Wolf, some of those policy costs, you will see sort of at the -- in 2014, in the fall of 2014, and that will be, of course, before the midterm elections.

And then Republicans would blame Democrats, not only for ObamaCare, but also for the increase in the cost of insurance policies.

So the big question here is, how does this affect ObamaCare in the long term? By doing this short fix, OK, for a year, what's the impact on that for the entire future of ObamaCare?

Because if these people don't sign up, it could be a huge, huge problem.

BLITZER: You just wrote a fascinating article, Gloria, on CNN.com, pointing out that the president is angry. He's mad. He's frustrated.

BORGER: Yeah.

BLITZER: And he's obviously deeply disappointed in his own team, that they failed to put together an adequate plan, even though they had three-and-a-half years to do so.

BORGER: Right.

BLITZER: Are we going to see, you think, any of that anger come through? "No Drama Obama" at -- when he makes this announcement at the bottom of the hour?

BORGER: You know, the president has told us, I'm angry about this. No one is angrier about this than I am, but he generally doesn't really show his anger and his frustration.

I remember he did it after the BP oil spill, after he was kind of prodded to do that by members of his staff. I think the way he shows it is by gathering his staff, telling -- you know, asking them, saying if I had known, maybe we would have delayed this whole thing.

And the real question that I was raising in the piece is, how is it that the president doesn't know? Why is it that this problem arises and it doesn't get to the Oval Office, but stops short of the Oval Office?

And I think the answer to that question is the people don't like to bring the president bad news and that this was a policy that was very decentralized.

And so not everyone was talking to each other and there wasn't one single person in charge, Wolf, who actually saw the enormity of the epic failure that they were about to create.

And so it never got to the chief.

BLITZER: And I want to recommend your article that we just posted -

BORGER: Thank you.

BLITZER: -- on CNN.com, Gloria. So people are going to go to that.

Don't go away. Jim Acosta, don't go away. Dana, don't go away.

Here's a question. Is this a turning point for the White House when it comes to the Affordable Care Act?

We're following the breaking news. You heard it first, you saw it first, right here on CNN.

A one-year delay, the president will announce for at least one significant part of the Affordable Care Act. The president getting ready to make that dramatic announcement from the White House, we'll have live coverage.

We'll take a quick break, much more right after this.

(COMMERCIAL BREAK)

BLITZER: We're following the breaking news. The president of the united states, President Obama, getting ready to make an important announcement in about 15 minutes or so.

At the bottom of the hour, he will go into the White House briefing room and tell everyone that a key part of the Affordable Care Act will now be delayed for one year, a part involving those people who liked their previous health insurance plans but were denied those plans because of new mandatory requirements from the Affordable Care Act, forcing these insurance companies to bump those plans. Now the president, because he had made that repeated pledge to the American people, if you like your plan, you can keep your plan. He has now tried to do this administrative executive branch fix without additional legislation required from Congress.

Christine Romans is our chief business correspondent. She's been listening and watching what's going on. A significant statement coming from the president. We don't know how the major insurance companies are going to react. We don't know if they can fix this, literally. Will the insurance companies comply? Will the go ahead and recreate those plans which they earlier dumped as a result of Obamacare. These are significant questions, Christine.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: They really are, and I mean just looking at the insurance stocks, and they're still up. The markets having an ok day today, so you're not seeing any big movement in their stocks as people still ask these questions and wonder what the president it going to say.

Now, remember, reason people were getting these cancellations is these policies they had are no longer legal. Some of them don't offer a free colonoscopy. Some of them don't offer maternity care. Some of them don't offer some of the important preventive measures that are now law under Obamacare. That's why they were getting these cancellations.

Now the insurance companies will have to go back and going to have to either rewrite these policies or reinstate these policies for the people who want them to be.

An interesting part of Dana's reporting, Wolf, is that the insurance companies will be required to give alternatives as well. This will be a one-year reprieve. In one year, you would find these people with a canceled policy having to navigate the healthcare marketplace again. So, that's where we stand.

By my count, Wolf, this would be the third sort of either delay or big change. There was a long-term care insurance part of Obamacare that was a big, big -- sort of a lifelong mission of the late Senator Teddy Kennedy. That has been sidelined more than a year ago.

And then you had the delay of one year for the small business owners who had to provide coverage for their employees, and now this. So you're seeing a very big, broad, sweeping change of health care as we know it in this country and you're seeing tweaks along the way, Wolf.

BLITZER: I'm sure this was not an easy decision for the president to make. He will make the formal announcement in a few minutes, something he certainly did not want to do. Under the enormous amount of pressure he has been under, presumably had no choice. He had to come up with some sort of fix. He promised the American people if they liked their plan, they would keep their plan. Now he is hoping he can honor that promise for at least a year.

All right, Christine, stand by. Let's get some analysis. Will Cain is joining us, the political commentator, columnist for The Blaze, John Avlon is also on the phone. First to you, Will, what do you think?

WILL CAIN, CNN POLITICAL COMMENTATOR: I cannot wrap my head around the absurdity of this, Wolf. First of all, I just want to run through three things that I think the American people need to understand about this proposed fix.

First of all, just the optics, just the message this sends by fiat-- here are the things that are now going to be allowed after I decided what will not be allowed I changed it and we have a new list of things that will be allowed.

This is the second point, Wolf. This is extremely important. How is this legal? We've heard from months this is the law of the land. Why does the law of the land get to be changed so capriciously over and over?

Finally and most importantly, how is this possible? Insurance companies have canceled these plans. It takes months to get something passed into regulator. If you're reinstating plans you're talking about months of passing them. Beyond that, some of these insurance companies have abandoned certain states. They have left the markets. The point is, you can't simply come in and do something and wish it to be so. The private industry has adapted to Obamacare and now you're changing it again.

BLITZER: And you're telling the insurance companies, after they've canceled all these policies, you know what? You have to un-cancel them.

CAIN: Right.

BLITZER: And we'll see how the president will explain that. He will be speaking momentarily. We'll see what he has to say. Will, standby for a moment.

John Avalon, let me get your analysis. WE know -- the outlines of what the president is going to say. It was broken here first on CNN by Dana Bash, our chief congressional correspondent. What do you think? JOHN AVLON, CNN CORRESPONDENT: Look, wolf, I think the president is trying to adjust to facts on the ground and a lot of conservatives who are slamming this pivot aren't exactly rooting for the law to work in the first place. You have a rollout, which has been disastrous. You have people getting kicked off the plans, contrary to the president's promise. It's reasonable for the president, not just in political damage control but a matter of providing a policy safety net to make an adjustment on the ground, to improve the current situation.

Let's be real, he was doing this because he was facing a rebellion of Democrats in the Senate and House, folks who were looking at the various proposals and want to grandfather in the people in who are getting kicked off these plans.

So, this is a pivot by the president but it's also a concession to reality. It's necessary to restore some kind of faith in this, as we go through the rocky period of rollout to try to address that. To ignore it, that would be ideological, that would be political suicide as well.

BLITZER: All right, John, standby. Will Cain, standby. I know that Elizabeth Cohen is looking at all the details as well. Our medical correspondent will be joining us.

We'll go back to the White House and go up to Capitol Hill. We'll take a quick break. We're waiting for the president. He'll be going into the White House briefing room within a couple of minutes. We'll be announcing a one-year delay of at least one key component of the Affordable Care Act.

(COMMERCIAL BREAK)

BLITZER: All right. In the next few minutes we'll hear a dramatic announcement from the president of the United States. He will say that there is going to be a major fix to the Affordable Care Act. A one-year delay of one key component to honor a commitment that he had repeatedly made to the American people. If you like your health plan, you can keep your health plan. He will now try to fix that. Clearly, that commitment earlier could not be kept.

Now, let's check in with Dana Bash up on Capitol Hill. She first broke the details of this so-called fix the president is getting ready to announce. Walk us through as we await the president, Dana, what this fix will include.

BASH: Our understanding, according to Democratic sources, is that what the president will announce is that for one year, people who have canceled insurance plans -- so we're in the individual insurance market, will be told by their insurance companies that they can keep that plan.

However, there are some important buts here. One is that the insurance companies will be required to tell these people that are renewing their canceled plans that there are alternatives, and explain what those alternatives are because a big part of the reason why they're canceled is because there are other, perhaps, better plans out there with regard to benefits. That's another thing that insurance companies are going to be required to tell consumers, that what they are renewing may not have the kind of benefits that are now required under the new health insurance law.

The other thing that might be an out, may be a big out here is that state insurance commissioners will be given leeway to opt out of this. Because a lot of this is run by the states, that might be a loophole. But also a way for insurance companies to sort of get out of this. Because, as we have been reporting, a big -- main reason why the president is doing this is political. Because people are angry. People are upset. People are panicked. And that is translating to members of his own party here on Capitol Hill who have elections next year. Many of them have tough races. And they are hearing from their constituents, wait a minute. We have no health insurance now. We can't get on this website. What are we going to do?

The downside, potentially, big downside with regard to the law and sustainability and viability of this law is that many people who have these individual market insurance plans, who have gotten cancellation policies are healthy, young people. That's why they have kind of flimsy plans. Those are exactly the people who this system needs in the broader new health care paradigm in order for it to work. They don't cost a lot, and it has to offset the cost of those with preexisting conditions and others who are now required under the law to have insurance and cost a lot.

BLITZER: Those are the bare bones of the details. The president will get into some specifics when he makes his announcement. Then his top aides, presumably, will have a lot more to discuss. Let's go to the White House.

Jim Acosta is standing by. You're in the briefing room. The president will walk in within the next few moments, we're told, make this announcement. We don't know if he will stick around for questions. We hope he does. Go ahead and tell our viewers what you're hearing over there.

ACOSTA: Well, Wolf, I can tell you that they're not saying a whole lot on the record right now. From everything we're gathering from administration officials at this point, they are not pushing back. They are not denying the reporting that's coming out of Capitol Hill from our Dana Bash and others about this administrative fix to the Affordable Care Act. This has obviously been a political problem for this president, as Dana was just talking about a few moments ago, this pledge that he made. If you like your plan, you can keep it. He apologized for it. I mean, this is something that the president has apologized for. And so now that he has issued that apology, he now has to issue this fix. That's what we'll be hearing from the president in about ten minutes from now.

Wolf, we don't know whether he will take questions, but I think it's a safe bet that we're all going to be shouting some questions at him as he leaves the room, if he doesn't do that. This is something that the president really has to deal with, as Dana was mentioning. Senate Democrats were over here at the White House, calling for answers last week, saying, hey, wait a minute. This is something that is untenable with our voters. Many of those Democrats were vulnerable incumbents. White House chief of Staff Dennis McDonough is headed to Capitol Hill today to go overall of this with both the Senate and House Democrats. They know they've got a big political problem on their hands. Just like you saw that there was an Obamacare rollout, this is an Obamacare fix rollout, starting with the president in just a few moments now.

BLITZER: All right, we'll stand by for the president. Gloria is here. I assume the White House lawyers, they've all reviewed this. They've concluded the president, on his own, without legislation, can go ahead and make this so-called fix.

BORGER: Well, he's asking. I'm trying to get an answer from the insurance companies about whether they're going to cooperate with this. I mean, he can't demand that they do something. The insurance companies believe that they followed the regulations they were given. They've done this. Now you're changing the rules. They believe -- the question is, this is going to be a death spiral for the entire Obamacare plan in the long term.

BLITZER: Why would it be a death spiral?

BORGER: Well, because the people who might renew these policies -- if the insurance companies say, okay, we're going to give you a year extension on it just for one year. Those young, healthy people -- a lot of the people who have these individual policies are young, healthy people who are maybe setting off on their own. If they don't go into the risk pool on Obamacare, the risk pool needs them in order to pay for the health care for the older, sicker people.

You have to have that mixture in there. If they stay away for another year, there could be a real problem. So the question I think the insurance companies are going to raise is, what is this going to do to Obamacare in the long term?