WASHINGTON -- Removing a potential political distraction ahead of next year's elections, the Obama administration Friday announced an early end to a health care waiver program that has come under fire from congressional Republicans.
Political considerations were "absolutely not" part of the decision, said Steve Larsen, head of a section of the Health and Human Services department that oversees President Barack Obama's health care law.
Larsen said no new applications for waivers will be considered after Sept. 22. Approvals or renewals received by the deadline will be good through 2013. Starting in 2014, the main coverage provisions of the health care law will take effect, and such waivers will no longer be needed.
The waivers address a provision of the law that phases out annual dollar limits on coverage by health insurance plans. Starting this year, plans could not impose a limit below $750,000. But some plans, offered mainly to low-income workers, currently provide $50,000 a year in coverage, and in certain cases much less.
Those plans would have been forced to close down or jack up premiums significantly, leaving more people uninsured.
The waivers were established to avoid disrupting existing coverage. In 2014, taxpayer-subsidized insurance will be available to most of the people now covered by the affected plans.
Some Republicans charged favoritism in the granting of the waivers, alleging that they were being granted to unions. But a review this week by the Government Accountability Office found that HHS had approved over 95 percent of the 1,400 waiver applications it received, most of them involving employer plans. The nonpartisan investigative agency also found that the administration used objective standards to make its decisions.
Larsen said Friday that insurance experts have advised his office that most plans that needed waivers probably already applied for them this year. For that reason, the effects of ending the program early would be negligible.
A conservative policy expert who has been critical of the program wasn't buying the technical explanation.
"It looks like they finally figured out they were in a public relations hole and decided to stop digging," said Ed Haislmaier of the Heritage Foundation think tank.