In an Op-Ed in the Sunday Wall Street Journal, Edie Littlefield Sundby claims that President Obama lied to her when he said that she could keep her insurance. As with every one of these stories that has surfaced to date, it has been proven to be riddled with errors. The real reason that Sundby, a stage 4 cancer survivor, is losing the insurance that she currently has is business and profits. Her provider, United Healthcare, has made the business decision to no longer sell to the private insurance market in California. The company based the decision on several factors that have little — if anything — to do with the advent of Obamacare.
They have long been a small player in the individual market and as such have faced difficulty for some time competing with the larger providers. They have been considering the change for some time now. Of the 2 million individual policies in the state, United held only 8,000 and could not compete with the two largest providers in the market: Kaiser Permanente and Anthem Blue Cross, Blue Shield of California who control 80% of the individual market.
The company also operates at a disadvantage against Anthem due to a special tax break that Anthem gets, and they don’t.
Both United and Aetna made the decision to pull out of the individual market in May–if they notified her in January as she claims. they gave her a longer lead time than they did others to find a replacement.
A spokeswoman for the company, Cheryl Randolf said, “Over the years, it has become more difficult to administer these plans in a cost-effective way for our members. We will continue to keep a major presence in California, focusing instead on large and small employers.”
Okay so we have established that Sundby didn’t lose her policy due to the new law, but her outrageous claims do not stop there. She also says that because of the law insurers can no longer sell insurance across county lines. She says this because she cannot find a policy that will allow her to use her doctors at both the University of California San Diego and at Stanford University’s Cancer Institute.
An exhaustive search to verify what seemed to be a false claim on the face of it proves that it is indeed false, there is no provision in the law which prohibits policies being sold across county lines. What she has encountered is something that occurs all the time. Insurers reduce the size of their networks regularly, and she likely would have eventually run into this problem even if United had remained in the individual market.
Again, this is the result of business decisions, studies have shown that consumers would gladly accept a more restrictive network if it meant lower premiums and the companies are simply responding to the marketplace when they restrict their networks.
There is one factor in the decision that United made to get out of the market which does involve Obamacare, yet that too is a business decision.
Last October UHC Chief Executive Officer Stephen Helmsley told the company’s investors, “The company’s plans reflect its concern that the first wave of newly insured customers under the law may be the costliest. UnitedHealth will watch and see how the exchanges evolve and expects the first enrollees will have ‘a pent-up appetite’ for medical care. We are approaching them with some degree of caution because of that.”
That, of course is just another way of saying that they will sit back and let the other companies absorb what are likely to be the most expensive customers before jumping back into the market to snatch up those who are probably healthier having had health care all along and therefore requiring less medical attention than those who have been getting only emergency care for years.
While everyone can sympathize with Ms. Sundby as a cancer survivor, she is way off base in blaming Obamacare for her situation. She is the victim of business decisions– nothing more.
h/t: Think Progress