Why some individuals are losing their health plans under ObamaCare

After President Obama signed the Affordable Care Act in 2010, he assured Americans that if they like their health care plan, they'd get to keep it when the law takes full effect in 2014. He made similar statements in the 2012 presidential campaign. And in most cases, it's true. For a few million Americans, though, it won't be.

Hundreds of thousands of people who buy their own insurance are already getting cancellation notices from their health insurers, informing them that due to the more comprehensive coverage mandated under ObamaCare, their old plans are defunct. Eventually, at least half of the 14 million individually insured Americans will get such notices, according to experts. Plenty of them will face "sticker shock," with their suggested replacement plans carrying significantly higher premiums.

"Those getting the cancellation letters are often shocked and unhappy," say Lisa Myers and Hannah Rappleye at NBC News. And despite Obama's earlier statements, "the White House does not dispute that many in the individual market will lose their current coverage, but argues they will be offered better coverage in its place, and that many will get tax subsidies that would offset any increased costs."

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The Affordable Care Act does include a "grandfather" clause that allows you to keep any plan you've held since before March 23, 2010 — the day Obama signed the law. "But the Department of Health and Human Services then wrote regulations that narrowed that provision," add Myers and Rappleye, "saying that if any part of a policy was significantly changed since that date — the deductible, co-pay, or benefits, for example — the policy would not be grandfathered."

Since people frequently change health insurance plans and insurers routinely change their policies, there were always going to be some percentage of individuals who had to switch plans when the ObamaCare health care exchanges kicked in. Nobody knows exactly how many will fall into that category.

It's certainly true that ObamaCare will have some losers, says Jonathan Cohn at The New Republic, though experts "say that, most likely, the majority of people will end up paying less" for better coverage, thanks to tax credits. But, Cohn argues, "even if those paying more are a relatively tiny percentage of the population overall, they will still be a large group in raw numbers. It’s a big country!" That's a problem for Obama and the supporters of the law, especially because the ongoing issues with Healthcare.gov, the law's online marketplace, are making the ranks of the affected seem even larger.

Another big problem, argues Ross Douthat at The New York Times, is that while ObamaCare's subsidies help individuals who earn up to about $46,000, or families of four earning up to $96,000, that "cut-off creates a chasm between winners and losers right in the middle of the middle class." Forcing a "small fraction of middle class America" to pay more "is not history's great injustice," he adds. "But neither does it seem like the soundest or most politically stable public policy arrangement."

Hold on, says Josh Barro at Business Insider. "The new system of subsidies and cross subsidies that ObamaCare sets up is far from perfect," he says, but the system it is replacing, giving tax breaks to people with super-expensive plans, is "insane." The relevant question about ObamaCare is this: "Is it better than the old system, where huge subsidies go to people with no need for them and tens of millions are left uninsured?" If you're honest about it, the answer is yes, Barro says.