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Tuesday May 31st, 2016 8:27AM

House OKs coverage plans that fall short of Obamacare rules

By The Associated Press
WASHINGTON (AP) -- The Republican-controlled House has passed legislation letting insurance companies sell individual coverage to all comers, even if it falls short of standards set in "Obamacare."

The vote was 261-157, and came after GOP lawmakers said the bill would ease the plight of millions of consumers reeling from cancellation notices.

The White House threatened a veto if the measure eventually reaches President Barack Obama's desk. Democratic leaders worked furiously to minimize defections on the issue, while mindful it is likely to figure prominently in next year's elections with control of Congress at stake.

The vote came Friday as Obama arranged a meeting at the White House with insurance company CEOs, and as the industry and state insurance commissioners began adjusting to an abrupt change in policy he announced a day earlier.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

House Republicans pushed toward a vote Friday on legislation to let insurance companies sell individual coverage to all comers, even if it falls short of standards in "Obamacare," saying it would ease the plight of millions of consumers reeling from cancellation notices.

The White House threatened a veto if the measure reaches President Barack Obama's desk. Democratic leaders worked furiously to minimize defections on the issue, while mindful it is likely to figure prominently in next year's elections with control of Congress at stake.

The debate and scheduled vote came as Obama arranged a meeting at the White House with insurance company CEOs, and as the industry and state insurance commissioners began adjusting to an abrupt change in policy he announced on Thursday.

Under the shift, Obama said insurers should be permitted to continue to sell individual coverage plans deemed substandard under the health care law to existing customers. Without the change, many existing plans would have been banned beginning next year, and the president's announcement was an attempt to quell a public and political furor triggered by millions of cancellation notices.

The House measure went one step further. It would give insurance firms the ability to sell individual plans to new as well as existing customers, even if the coverage falls short of the law's requirements.

"For the last six weeks the White House stood idly by ignoring the pleas of millions," said Rep. Fred Upton, R-Mich., chairman of the House Energy and Commerce Committee and lead sponsor of the legislation.

"Our straightforward, one-page bill says, if you like your current coverage, you should be able to keep it. The president should heed his own advice and work with us, the Congress, as the founders intended, not around the legislative process."

But Democrats said the measure was just another in a long line of attacks on the health care bill from Republicans who have voted repeatedly to repeal it.

"It would take away the core protections of that law. It creates an entire submarket of substandard health care plans," said Rep. Henry Waxman of California.

To qualify under the law, insurance plans would have to conform to numerous conditions. Among them, they would have to accept all customers, regardless of pre-existing conditions, would be limited in additional premiums they could charge on the basis of age and could not cap lifetime benefits. They also would have to include coverage in a wide range of areas - doctor and hospital care for adults and children, laboratory services, preventive coverage and prescription drugs.

In a veto threat Thursday night, the White House accused Republicans of seeking to "sabotage the health care law," and said their measure would allow "insurers to continue to sell new plans that deploy practices such as not offering coverage for people with pre-existing conditions, charging women more than men, and continuing yearly caps on the amount of care that enrollees receive. "

The cancellation issue is only part of the woes confronting the president and his allies as they struggle to sustain the health care law.

Obama has repeatedly apologized for a dismal launch of HTTP://WWW.HEALTHCARE.GOV , which consumers in 36 states were supposed to use beginning on Oct. 1 to sign up for new coverage. The website is so riddled with problems that the administration disclosed earlier this week that fewer than 27,000 signups have been completed - a number that Republicans noted is dwarfed by the flood of cancellations issued due to the law.

Compounding the administration's misery, the poor quality of the website has made it that much harder for consumers receiving cancellation notices to shop for alternative plans.

It is unclear what, if anything, the administration is prepared to do to alleviate the threat of a break in coverage for those consumers.

In addition, there already are signs of resistance among state insurance commissioners, who would have to agree to allow Obama's proposed change to take effect. At the same time, industry officials and commissioners alike warn that premium prices could rise beginning with 2015 coverage plans if the changes go into effect.

The Democratic opposition to the House measure was based in part on a fear that opening cheaper substandard plans to all comers could wind up driving premiums higher for the rest of the population.

The concern they express is that younger, healthier Americans would be attracted to the cheaper coverage, rather than seek out a plan that conforms with the Obamacare requirements.

Younger, healthier individuals are generally less expensive to cover for an insurer, and the more they shun the government-run insurance exchanges set up under the law, the higher the premiums could be for the relatively older, sicker customers who shop there.
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