The Obama administration has reportedly admitted for the first time that many individual insurance plans and plans for small businesses offered through government exchanges -- even with subsidies -- will be more expensive than plans consumers purchased before the Affordable Care Act became law. President Barack Obama and administration officials have promised Americans for years that the plans offered under Obamacare would save most Americans money.
Gary Cohen, director of the Center for Consumer Information and Insurance Oversight, reportedly wrote a letter to state insurance commissioners on Thursday explaining that "one reason for the new Obamacare measures the president announced Thursday is that millions of consumers receiving cancellation letters from their insurers are learning the Affordable Care Act options are in fact less affordable," the Daily Mail reports.
"Although affected individuals and small businesses may access quality health insurance coverage through the new Health Insurance Marketplaces, in many cases with federal subsidies, some of them are finding that such coverage would be more expensive than their current coverage, and thus they may dissuaded from immediately transitioning to such coverage," Cohen wrote.
President Obama in 2012 pledged that Obamacare would lower the average American's premium by $2,500.
More from the Daily Mail:
Cohen's letter also goes further than the words Obama used Thursday to hedge his bets while he outlined a new strategy to allow Americans to keep policies that their insurers have already canceled.
'My working assumption was that the majority of those folks would find better policies at lower cost or the same cost in the marketplaces,' he said.
'We will continue to make the case, even to folks who choose to keep their own plans,' Obama promised minutes later, 'that they should shop around in the new marketplace because there’s a good chance that they’ll be able to buy better insurance at lower cost.'
That 'good chance' of cost savings is a weaker standard than the White House has employed before with messaging that promised no insurance price hikes to 'most people.'
Read Cohen's letter to state insurance commissioners below:
CMS letter on Obamacare Nov-14-2013.pdf
To read the Daily Mail's full report, click here.