Health care reform

Will ObamaCare's Health Exchanges Be Ready on Schedule?


When ObamaCare became law, virtually everyone believed that every state would create its own health insurance exchange. That didn't quite work out. As of last week, only 17 states plus the District of Columbia had officially declared that they would take full responsibility for creating their own exchanges. At least 16 states have entirely opted out, leaving the federal government to build and run the exchange instead; others have chosen a partnership model that still leaves much of the responsibility to the federal government. As a result, implementation will proceed along two fronts: the state level in some case and the federal level in others. And there are real questions about whether the exchanges will be built on time in either case.

Some of the states that have been most aggressive about creating the exchanges are nonetheless worried about delays. In the District of Columbia, for example, authorities have admitted that the timetable is just too aggressive. Deadlines originally set for January 1 of 2013 aren't going to be fully met. "No state is going to be able to be fully certified on Jan. 1,"  Bonnie Norton, D.C's acting director of health reform, told The Washington Post. "When they passed the ACA, they were highly optimistic about the timeline for states to implement exchanges."

Even bigger questions remain about whether the federal government will be able to build the exchanges it is now expected to have up and running before the end of 2013. In the OC Register, Ben Domenech predicts that the federal exchanges will ultimately be delayed:

Obama administration officials are desperate to meet the deadlines because they know implementation will be very difficult, if not impossible. They've kicked the can down the road again and again, with vague rules and regulations that raise more questions than they answer. In states that won't comply, health care bureaucrats will have to handle the creation of two federal exchanges – one for individuals, one for small businesses – an extremely difficult process.

All along the Obama administration has clearly been fairly nervous about this aspect of the process – it wants to be able to spread the blame around to state governments if the whole system comes crashing down.

Here's where the motivation for delay comes in. The implementation phase of Obama's exchanges will likely make for some interesting reactions in 2014, an election year and the first time when most people will have direct experience with Obama's health care law. The public's reaction could be significant for the Democrats' political prospects. If the system isn't ready, some Hill Democrats are murmuring, better to shift it to 2015 and take it off the table for a year.

Speaking to Investors Business Daily's David Hogberg last week, Cato Institute Health Policy Director Michael Cannon also predicted delay:

"HHS expected to be running zero exchanges," said Michael Cannon, director of health policy studies at the libertarian Cato Institute. "They have been throwing money at states to bribe them to start exchanges. HHS maintains they'll have these things up and running by October 2013. I don't know anyone who is confident about that and I'm ready to predict that they will not."

Delayed implementation would not necessarily mean that the law ultimately fails to get up and running. But it would certainly complicate messaging on a law that's always struggled in popular opinion, and further undermine public confidence in the administration's ability to deliver on its health reform promises. 

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  1. The public’s reaction could be significant for the Democrats’ political prospects.

    Political considerations are the most important considerations of all.

  2. “Will ObamaCare’s Health Exchanges Be Ready on Schedule?”


    Seriously, is this a question which even needs to be asked?

    It would take a miracle for them to be up and running prior to the 2016 Presidential elections.

    Even a top notch agile development group with full authority to make decisions on their own couldn’t get it done in a year, throw in the inevitable top down control waterfall** approach and never ending requirements definition meetings where different government agencies are vying for control and honestly I am not sure it can ever be done and actually work.

  3. And gov’t medical care is soooooo successful:
    “Vets die awaiting benefits”…..133602.php

    1. Tell me about it.

      A few months back the VA literally lost my father for about 2 weeks and he damn near died as a result.

      He was rushed to the ER for some sort of VERY bad infection (like 104+ fever) and when my mother got to the Hospital she was told that he was redirected to a different VA Hospital but the VA had no knowledge of where he was.

      It took her 2 weeks to find him

      1. I’m entitled to VA care for life.

        I pay for my own.

        1. Randian| 12.20.12 @ 4:57PM |#
          “I’m entitled to VA care for life.
          I pay for my own.”

          Which means you can measure the rest of your life with something other than a stop-watch.

  4. I actually feel bad for those thousands of bureaucrats who will pay the price for failing to get their job done on time.

  5. There is no way on God’s green earth that a functional federal exchange will be running by 01/01/14. Possibly, just possibly, they could have something going by 01/01/16. There might be a state or two that will beat that launch date, but I’ll be impressed if any states are up and running by 01/01/14.

    The delicious part, of course, is that the employer penaltax is triggered by employees buying through the exchanges, so no exchange means no employer penaltax. Without exchanges, I don’t see how they can impose the individual penaltax either, since it is supposedly predicated on you being able to buy through an exchange, but choosing not to.

    This will be an epic trainwreck. I can hardly wait for the Dems to start proposing legislation to push all these deadlines back.

    1. The one saving grace of massive government is its massive incompetence. Jeebus help us if they weren’t utterly incompetent.

      1. It’s a fresh interpretation of the Peter Principle.

  6. We should probably be glad that Top Men have not been able to devise the federal exchange yet; however, if these Top Men had been in charge in 1943-1944, Eisenhower’s and Marshall’s grandsons would still be planning the D-Day invasion.

  7. I’ve been reading that the employer penaltax only applies to state run exchanges, not those setup by the federal government. And as the economy limps along and the government running trillion dollar deficits, I doubt we’ll see HHS getting money to setup exchanges. Throw in the fiscal cliff and Obama has set himself up for one big fail.

    1. “Obama has set himself up for one big fail.”
      Those darn rethuglicans!

  8. Man did John Roberts screw this country.

    1. The only thing truly unconstitutional in the act was the mandate (and maybe the Medicare bullying) so the exchanges would go through regardless of Roberts’ decision.

      1. Not if the mandate was ruled unseverable then the entire thing would be thrown out.

  9. This is the one good thing to come out of the Obama re-election. If Romney had been President, this epic fail would have been blamed on him. Now it will be blamed on Bush.

    1. “Now it will be blamed on Bush.”

      “Whipping boy”
      “A whipping boy was a young boy who was assigned to a young prince and was punished when the prince misbehaved or fell behind in his schooling.”
      Can’t hold the anointed one responsible…

    2. I’m pretty sure there was a Presidential Daily Briefing in July 2008 that said “Obamacare” might possibly happen sometime in the future. Bush obviously ignored it, thus it’s totally all the repubs fault.

  10. Dude seems to know whwat he is talking about. Wow.

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