Insurers Are Offered Assistance for Losses

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WASHINGTON — The White House is offering more money to insurance companies as an incentive for them to let people keep insurance policies that were to have been canceled next year.

The administration floated several proposals on Monday to “help offset the loss in premium revenue and profit” that it said might occur if insurers went along with President Obama’s request to reinstate canceled policies.

Millions of people have received notices saying their policies were being canceled because they did not comply with minimum coverage requirements of the new health care law.

In a notice published Monday in the Federal Register, the administration acknowledged that insurers had a valid concern: They may be stuck with sicker, higher-cost customers in the new insurance exchanges because healthier Americans will stay on their existing health plans for another year.

Facing a political furor over the cancellation of insurance policies, Mr. Obama announced on Nov. 14 that he would temporarily waive some requirements of the new federal law and allow insurers to renew “current policies for current enrollees” for a year.

Insurers criticized the president’s move, saying it could upset the assumptions on which they had set premiums for new insurance products providing coverage in 2014.

Many people with serious illnesses were excluded from the old policies. As a result, the administration said, people on those policies may be healthier than average.

If they do not enroll in the new health plans, the administration said, the average cost of claims for people in those plans may be higher than expected, and this increase in costs could lead to unexpected financial losses for insurance companies.

To reduce this risk, the administration said it could provide financial assistance to certain insurers through a program under which the government will share in their losses and profits for the next three years.

Any such assistance would come on top of federal subsidies that the government plans to pay insurers to make coverage more affordable for low- and middle-income people under the new law. The Congressional Budget Office estimates that those subsidy payments will exceed $1 trillion over the next 10 years.

The administration said it could not immediately determine the cost of the assistance for insurers because it did not know how many people would stay in existing plans or how many would decide to enroll in new policies that provide additional benefits and consumer protections, as required by the 2010 health law.

Robert E. Zirkelbach, a spokesman for America’s Health Insurance Plans, a trade group, welcomed the proposal, saying, “We appreciate that the administration is taking steps to stabilize the market and minimize disruptions for consumers.”

But Jamie Court, the president of Consumer Watchdog, a liberal advocacy group, said the proposal was premature. “Insurers are already being paid by taxpayers for the vast majority of new enrollees,” he said.

 The notice published on Monday includes proposals on several other issues. Certain health plans sponsored by labor unions would be exempted from new fees imposed on insurance companies and on many self-insured group health plans.

Labor unions have been lobbying for such an exemption, saying the fees could be “highly disruptive” to Taft-Hartley plans administered jointly by labor and management representatives in construction, entertainment and other industries.

But Republicans denounced the administration proposal. Senator John Thune, Republican of South Dakota, said it would provide “special treatment to President Obama’s political allies.”

The fees, to be levied from 2014 to 2016, will provide money to insurers that incur high-dollar claims for consumers in the individual insurance market.

The administration on Monday also reported a surge in the number of people using the website for the federal insurance marketplace,

Julie Bataille, a spokeswoman at the Centers for Medicare and Medicaid Services, said that 375,000 people visited the website in the first 12 hours on Monday, about twice the normal traffic.

Because of the increase in demand, Ms. Bataille said, “we deployed a new customer queuing system, or waiting room, to help manage the traffic.” People will receive email messages inviting them to return to the site at another time when it is less busy.

The surge came just a day after the White House said the website was greatly improved and would “work smoothly for the vast majority of users.”

Jeffrey D. Zients, the presidential adviser leading efforts to fix the site, said Sunday that it could handle 50,000 users at a time. He reported that pages on the site were loading much faster, with a response time of less than one second and an error rate less than 1 percent.

But Ms. Bataille said federal officials decided to divert traffic from the website at a time when it had about 35,000 users on Monday. The performance of the site appeared to be faltering, as the response time exceeded two seconds and the error rate was nine-tenths of 1 percent, officials said.

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