Obamacare

Defunding Obamacare Won't Work. How About Delay?

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Whitehouse.gov

Given the practical limitations of the push to shut down Obamacare by defunding it in a continuing resolution, some opponents of the law are looking for alternatives.

Truth be told, they're hard to find. Obamacare survived a Supreme Court challenge and a presidential election, which means that, despite public dissatisfaction with the law, those who oppose it don't have many strong options.

But amongst those who are wary of the defunding strategy, there's a general consensus that the best remaining option is to push for some sort of delay.

The question is: What to delay? The most obvious provision to go after is the individual mandate. It's broadly unpopular. Democrats won't want to defend it; 22 House Democrats have already voted to delay the mandate for a year. President Obama himself opposed the individual mandate during his first campaign. Polls have found that there's public support for delaying the provision as well.

The mandate, in other words, is the law's weak point—its "soft underbelly," as Yuval Levin and James Capretta put it. Building a bipartisan coalition to delay the mandate wouldn't be easy, exactly. But it would be easier than doing so for any of the law's other major provisions.

There are, however, some potential objections to a push to hold off on the mandate. The first is that it's simply bad policy. Without a mandate, insurance markets forced to abide by community rating and guaranteed issue regulations, which require insurers to cover all applicants at regulated rates regardless of health history, would likely melt down. That's what happened in states that tried those same regulations without a mandate.

But for at least some supporters of the mandate delay, however, that's the whole point. As the administration's legal team argued when defending the mandate in court, the individual insurance requirement is "the lynchpin" of the entire law. Delay the mandate, and you cause the whole scheme to break down.

Another objection is that although delaying the mandate could cause havoc for the law, it would leave the law's subsidies—which account for virtually all of Obamacare's spending—in place. And once those subsidies start flowing to beneficiaries, they will be virtually impossible to repeal.

That's why you may see a push to delay the subsidies as well. For those fighting the law, the upside to this approach is obvious—without subsidies, the major benefit of law isn't in effect, and is thus easier to modify or repeal. The risk here is that it's a bigger ask, and significantly less likely to find support within the administration, which is clearly prioritizing enrollment in subsidized coverage on the understanding that once they are in place, the law will be virtually impossible to fully take down.

Neither of these strategies is a sure thing. But a push to delay the mandate is more likely to succeed than a push to delay the subsidies, or the entire law, which is why it's the strategy we're most likely to see. And what happens then?

If it doesn't work, then Obamacare goes forward, with all problems it was already going to have. But even if it works, and the mandate is put off for a year or more, will it really work? Pushing the insurance market into a death spiral is more than a little risky, especially if the subsidies remain in place.  The result may be a law that remains on the books and is impossible to fully repeal—but is even more dysfunctional than it was already. 

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  1. Why does Suderman suddenly love Obamacare so much? Who’s gotten to him, and what do they have on him? Is it video game related?

    1. He’s always been squishy on OCare. He telegraphed on Day One by insisting on calling it the “Affordable Care Act”. That’s the name supporters used before they were swept up in the irresistible tide of “ObamaCare”.

    2. I don’t see how this is “loving Obamacare”. He’s obviously claiming that defunding it won’t work (right now, anyway) and that there are other options to try.

  2. I just put this in the ML .. .but i’ll drop it here too.

    “The Office of Personnel Management will issue a rule next week ensuring that the federal government will contribute to the cost of premiums for congressional staff purchasing health insurance through the exchanges created by the health overhaul.”

    1. The Office of Personnel Management will issue a rule next week

      Hail Carnac, the magnificent!

  3. Instead of delaying the mandate, legalize cheap high-deductible and catestrophic-only plans for everyone. Allow those plans to cover fewer preventive procedures and to exclude some pre-existing conditions (i.e. actually existing cancer), so that their cost can be kept down.

    The mandate is unpopular right? But if you delay it, you may take the blame for causing the insurance market to go into a death spiral. But there’s a lot of popular opposition because people will be forced to buy these expensive plans. Althernative? Offer them the option of buying a cheap plan that acts like real insurance.

    What will happen is all those young invincibles, instead of paying the penalty, will purchase the cheap high-deductible plans instead. So what will happen is that the Gold/Silver/Bronze plans will go into a death spiral and the insurance market will only be left with the high-deductible plans.

    1. Instead of delaying the mandate, legalize cheap high-deductible and catestrophic-only plans for everyone.

      “BUT THAT’S NOT INSURANCE!!1”

      /Derpgressive

      1. Actually, yes, it is insurance. It’s exactly what insurance is supposed to be. Anyway. We’re not arguing with progressives. This is a legislative maneuver. You put the Democrats in the position of explicitly opposing allowing people to buy a type of plan that is currently legally available. A type of plan that protects them from medical bankruptcy and from becoming a cost to the system. You thus eliminate the argument that these people will end up in the emergency rooms and not be able to pay for care.

        1. and as a bonus, you put some of the onus for paying for small scale procedures on the consumer. As it is, people bitch about modest co-pays, as if medical services are something they are owed.

          1. Drives me crazy. People who can always find a few hundred to have their car worked on can’t find a nickel to pay their own health care bills.

        2. We’re not arguing with progressives.

          Yeah, actually, I think we are. They’re the ones who made high deductible policies unavailable to anyone over 30.

          1. I have one, at least for now.

            1. So do I, but the law hasn’t fully taken effect. My understanding is that current policies will be allowed to expire but you can’t get another one.

              1. I havent heard what is going to happen from my insurance company yet.

                I think my deductible can be dropped from $2500 to $2000 and fit in as a “bronze” plan, so Im guessing that is what is going to happen.

                1. I bet that costs me more than $500 per year too.

                  1. Your insurance rate will go up, for sure.

                2. Yeah, that could be but the deductible is going to have to go way down in order to meet the payout requirements.

                  I haven’t looked at anything with lower than a $5000 deductible. I guess we’ll see how it goes.

                  1. Yeah, the MLRs may still be a problem. The insurance companies are going to want to be spending money.

                    The high-deductible policy I had would renegotiate fees downwards for me. Perhaps you could allow them to count the “discount” as an expense. They spend money to negotiate the fees downward, from my perspective, it’s no different than if they had paid that money to the doctor. You could set up a formula to let thme claim discounts and renegotiated fees towards the MLR.

                    1. Bonus: They should probably do that anyway, because they need to incentivize the insurers to keep costs down anyhow. If the insurer gets no benefit from negotiating fees downwards – they have to refund all of the money to consumers – they will have no reason to do so.

                      There’s a rational argument for doing that independent of the whether you want to repeal the law or not.

        3. Actually, yes, it is insurance.

          Thats the most broken sarcasm meter Ive ever seen.

          It couldnt be more broken.

          1. It’s not broken, I’m responding to the underlying idea that the derp of stupid progressives would get in the way of implementing my scheme.
            The “it’s not insurance” argument doesn’t cary water.

    2. Note: Start by introducing a bill to add minimal high-deductible plans to the list of qualifying plans. Then tack on provisions that weaken the guarenteed issue and community rating provisions for those plans.

    3. it’s a safe bet that more than a few folks would see the insurance market going into a death spiral as a feature rather than a bug.

  4. Looks like CA has finally determined the amount of competition we’re going to get to drive the prices down!
    “businesses with 50 or fewer workers will be able to pick a level of coverage from a standardized set of benefits. Their employees will then select from among four insurers: Blue Shield of California, Chinese Community Health Plan, Health Net and Kaiser.”
    That’s four, count ’em, four. So far…
    http://www.sfgate.com/health/a…..702323.php

  5. We have to destroy the insurance industry to save it.

    1. Ah yes…the “Schackowsky Plan”!

  6. But a push to delay the mandate is more likely to succeed than a push to delay the subsidies

    No kidding.

    But don’t worry, DEFICITS DON’T MATTER!

    1. of all the lessons for Obama to learn from Cheney…

    2. In a weak economy with negligible inflation, a strong case can be made that deficits don’t matter at this point in time. A much stronger case than the one for “the deficit is the only thing that matters.” Which of course you only pretend to believe as a means to the end of obliterating the welfare state. At least that’s what smarter people than you are doing–you probably actually think deficits matter right now. I mean, they have to have some people actually buy into their cynical bullshit, even if your policy goals are the same.

      Not that any of this is relevant, since the latest CBO estimate is that the ACA reduces the federal deficit by more than $200 billion. Hence, repealing it would raise the deficit by that much.

      1. Tony| 8.2.13 @ 11:11AM |#
        …”Not that any of this is relevant, since the latest CBO estimate is that the ACA reduces the federal deficit by more than $200 billion. Hence, repealing it would raise the deficit by that much.”

        Yes, shithead, I’m sure you’re stupid enough to actually believe that.
        BTW, did you know rabbits grow in hats?!

        1. Truth is whatever you need it to be to sustain your dogma. I get it.

          1. Tony| 8.2.13 @ 11:25AM |#
            “Truth is whatever you need it to be to sustain your dogma. I get it.”

            No, I just don’t bleeve in magic, shithead.

      2. In a weak economy with negligible inflation, a strong case can be made that deficits don’t matter at this point in time

        Typical short-term thinking. What’s the exit strategy for the deficits (and, since they’ve been monetized, for the Fed’s mindblowing expansion of the money supply)?

        1. If the economy is weak, we need deficits. If the economy is strong, we can afford deficits.

        2. Since the federal deficit has been going down at a near record pace, it would seem that your concerns are being addressed. When might fiscal hawks start caring about things that actually do matter, like unemployment? Or god forbid the cost and availability of healthcare?

          1. Tony| 8.2.13 @ 11:25AM |#
            “Since the federal deficit has been going down at a near record pace”

            Some “record”, shithead.

          2. Since the federal deficit has been going down at a near record pace…

            And still almost double the 2008 deficit.

            Do you not know how disingenuous it is to talk about how much the deficit has come down compared to the “save the world” stimulus levels or do you just not care? Either way, again, we’re still talking about a deficit that’s almost a third of a trillion larger than then 2008 deficit.

          3. When might fiscal hawks start caring about things that actually do matter, like unemployment?

            Well, all that spending doesn’t seem to be helping much at all, so I don’t see how stopping it is going to hurt much at all.

          4. Or god forbid the cost and availability of healthcare?

            Healthcare is available to 100% of the people who live in this country. So I think we’ve got that covered.

            Healthcare is massively subsidized with tax money, so if you’re looking for why it has gotten so expensive, that might be one place to look.

        3. Presumably the notes ($) will be attractively “redeemed” by some asset of the Fed, or conceivably of someone else, and whoever sells it won’t ever spend the money. In other words, people will pay dollars for something they want more, and which will therefore soak up the money supply, provided the seller effectively burns the dollars.

          As for the deficits, the exist strategy for them would be the same: the sale of assets. But they’d have to be assets that would not be obligations.

      3. How will the ACA reduce the deficit, when the government will essentially pay citizens to buy healthcare? What about the expansion of medicaid?

        Are you suggesting that “preventive” care will reduce cost? In the long run, a tidal wave of patients flooding hospitals to get checked out every year will end blowing up healthcare cost. No hospital in LA can afford to have even 20-30 of the local population coming to get checked for cancer or random disease they read about in Webmd.

        It would be FATAL mistake to assume that Americans will use their insurance responsibly. And we’re not Canada or Japan, who keeps healthcare cost down in ways that even liberals won’t agree to.

        I’ll admit to “rooting” for the ACA to fail. But even if I wasn’t, the chances of this behemoth of a wannabe insurance mandate working out is…… small. Either the patients, the hospitals, or the insurance company will mount serious objections as the years float by.

  7. And once those subsidies start flowing to beneficiaries, they will be virtually impossible to repeal.

    Bullshit. Justs take a bill to be passed by House, Senate and signed by President, or the House and Senate to override his veto.

  8. Delaying the subsidies is far more important than delaying the mandate. As pointed out, once the bennies start flowing they’ll be near impossible to stop and will at best mean that we get huge direct tax increases to cover them.

    1. As a tweak to my version, you could say that the el-cheapo high-ductible plans don’t qualify for subsidies, they just qualify you to avoid the penalty.

      1. To explain. If there’s a death spiral in the bronze/silver/gold level plans that come with all the bennies, then it won’t matter if we offer subsidies cause even with the subsidies people won’t buy them.

  9. In a weak economy with negligible inflation, a strong case can be made that deficits don’t matter at this point in time.

    “A chicken in every pot.”

    1. “Every man a king!”

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