Wednesday, July 3, 2013

Maybe not so clever...ObamaCare Delay


Written by . Posted in 2014 CampaignsFeaturedIssue Watch
Published on July 03, 2013
obamaDoug Holtz-Eakin is one of the smartest guys out there when it comes to Obamacare, so I take his opinion seriously when he says that Obama has made a sharp political move by pushing off the employer mandate for a year:
Harm to health care, interrupted health insurance, bigger federal deficits, and brazen disregard for the law of the land sounds like a bad idea.  Why do it? 
Politics.  Democrats no longer face the immediate specter of running against the fallout from a heavy regulatory imposition on employers across the land.  Explaining away the mandate was going to be a big political lift; having the White House airbrush it from the landscape is way better.
It helps with ObamaCare in other ways as well.  The administration was flailing to find high-profile allies (e.g., the National Football League) to advertise the wonders of ObamaCare.  In a single masterstroke it has given every company a reason to explain its existence (“don’t worry, you’ll be fine in the exchanges”) and created a de facto advertising campaign of enormous scale and reach.  Deviously brilliant. 
I can see how this might help Obama politically, but I’m not so sure this is brilliant — or if it is, I would consider it brilliant only in the sense that it averts an even worse failure. The administration isn’t doing this because it can — it’s doing it because it must.
First, as Phil Klein argues, you don’t delay something because it’s so wonderful. The delay, on its own terms, is a politically embarrassing admission that they’ve created a law that will make things worse. It won’t be hard to exploit that reality.
Second, this only invites further delays where the law allows. The official explanation of this is that it has to do with reporting requirements. That’s highly doubtful. When you look at all of the municipal governments that are part-timing their workforces in order to escape the employer mandate, it’s problematic nature becomes clearer. There might have been a realization at some level that this was going to counteract stimulus efforts to bail out city and state governments. 
Third, as Holtz-Eakin also notes in his statement, this move is highly likely to encourage patient-dumping from good but expensive company health plans into exchange plans. If a lot of dumping does occur, that could prove politically costly. That whole business about how if you like your insurance you can keep it? Yeah, not so much. This could help Republicans reach out to middle-class employees at big companies, 
And finally, it was never the purpose of Obamacare to move already-insured people into health-insurance exchanges. The purpose was to ensure the uninsured. And by dropping the employer mandate, the administration is making its this goal more difficult to fulfill.
Until yesterday, employers faced a choice as of this coming January between providing insurance or paying a fine. Absent the employer mandate, the businesses that don’t currently provide it to employees now have no incentive to start doing so until 2015, and in fact it probably have a disincentive to offer it until at least then, if even then.
So how many people get stuck in a situation where exchange premiums are prohibitively high, they’re not eligible for a big enough subsidy to put it within their reach, and their employer still doesn’t offer health insurance? Those in this situation now aren’t buying insurance in the individual market at lower rates — what makes you think they’re going to buy it on the Obamacare exchanges for higher rates? And what will people be saying about this law when it doesn’t result in a huge surge of newly insured?

- See more at: http://conservativeintel.com/2013/07/03/the-obamacare-delay-maybe-not-as-clever-as-obama-thinks/#sthash.aqXYlVUm.dpuf

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