Obamacare

Is the President's Obamacare Tweak Legal?

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Whitehouse.gov

Writing at the Volokh Conspiracy, Case Western Reserve Law Professor Jonathan Adler is skeptical:

According to the President's announcement, insurance companies will be allowed to renew policies that were in force as of October 1, 2013 for one additional year, even if they fail to meet relevant PPACA requirements. What is the legal basis for this change? The Administration has not cited any. (See, e.g., this letter to state insurance commissioners explaining the change.) According to various press reports, the Administration argues it may do this as a matter of enforcement discretion (much as it did with immigration). In other words, the Administration is not changing the law. It's just announcing it will not enforce federal law (while simultaneouslythreatening to veto legislation that would authorize the step the President has decided to take).

Does this make the renewal of non-compliant policies legal? No. The legal requirement remains on the books so the relevant health insurance plans remain illegal under federal law. The President's decision does not change relevant state laws either.  So insurers will still need to obtain approval from state insurance commissioners. This typically requires submitting rates and plan specifications for approval. This can take some time, and is disruptive because most insurance companies have already set their offerings for the next year. It's no wonder that some insurance commissioners have already indicated they have no plans to approve non-compliant plans.

Yet even if state commissioners approve the plans, they will still be illegal under federal law. 

We've already seen resistance from state insurance commissioners, who have argued that the president's proposed tweak simply isn't feasible. And the health insurance industry doesn't seem particularly thrilled with the plan either. Insurers have a meeting at the White House today, so we'll presumably have a better idea of where health plans stand by the end of the day. 

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  1. What is the legal basis for this change?

    l’etat c’est moi

    1. Brooks beat me to it, again.

    2. Va te faire foutre, voil? pourquoi.

    3. l’etat c’est moi

      Et apres moi, le deluge.

  2. the health insurance industry doesn’t seem particularly thrilled with the plan either

    ‘We’re not the fall guy, you are, mister “can’t be elected again”‘

  3. Wait, I just thought of something. What if Obama *knows* that this decree of his won’t actually result in restoring those plans? What if this is a cynical political move to fool voters into thinking losing their plans isn’t his fault?

    1. *gasp* How could you be so cynical?

      /obot

    2. there were plenty of Obots who were saying the cancellations were done by insurance companies BEFORE yesterday’s about face.

    3. If he thought this plan would actually result in the policies getting extended one year, he wouldn’t have done it. That is, if the plan worked, the policies would all get canceled again next October right before the election.

    4. That’s obviously the case, and he took this action to forestall a vote in Congress.

      But, this time, he’s being too clever by half. Because the plans will not be reinstated and Congressional Dems will be on record for voting against a keep your plan law.

  4. silly peasants

  5. So, insurers are supposed to rely on promises from the Most Transparent Administration in History (TM) that they won’t be prosecuted for selling illegal plans. Brilliant. That’s what these dumbasses get for supporting this shit in the first place.

    1. rely on promises from the Most Transparent Administration in History (TM) that they won’t be prosecuted

      Yeah, cuz that worked out real well for medical marijuana providers.

    2. Jordan|11.15.13 @ 10:06AM|#
      “So, insurers are supposed to rely on promises from the Most Transparent Administration in History (TM) that they won’t be prosecuted for selling illegal plans.”

      Obo admin to bank X, year Y: “You *will* buy this distressed mortgage company!”

      Obo admin to bank X, year Z: “We’re suing you for what that mortgage company did before you bought it!”

    3. Not only that, but you have to rely on every future administration and every future state insurance commissioner, attorney general and governor through the end of the statute of limitations.

      AND consumers who don’t get certain types of care paid for under their existing plan, who may have had that care paid for under an Obamacare plan, can litigate that matter in civil court through the end of their medical histories, which in many cases will span decades if not more than a century.

      1. Tossing random mutations into complex systems rarely makes them better.

  6. Barack Obama is the law.

    “L’Etat, c’est moi”.

    Where are the torches and pitchforks when we need them?

  7. I’ve been saying for days – it’s not possible or reasonable for the insurance companies to even try to extend those policies.

    http://pjmedia.com/tatler/2013…..-insanity/

    1. True dat. But the insurance companies are now have the difficult task of explaining that reality to a low-information public.

      1. “Despite what the Lightworker said, it is still against the law”.

  8. So let it be written, so let is be done. Wait..where have I heard that before?

    Obama – the Xerxes of modernia.

    1. Ramesses II

      1. Yul Brenner

        1. “Don’t smoke!”

          1. The cake is a lie!

  9. Here in California, I’m sure our idiot insurance commissioner Dave Jones will carry this water for Obama. After all, he floated a bill as a state legislator with a Guaranteed Issue clause for pet insurance as his bona fides. So yes, Top Men are on it.

    1. While most state Insurance Commissioners are probably big government enthusiasts, they are also big-time bureaucrats. And bureaucrats hate the idea of giving up power.

      So, I doubt most of them will waive 60-day notice and filling requirements. I doubt they will approve a policy for sale without the usual (many months-long) review for compliance, even if they have reviewed the same policy in the past.

      1. “I’ve asked Covered California to take this action immediately so that health insurers are free then from this contract provision and can follow the president’s request, and my request, that they allow their existing customers to renew their policies into 2014,” Jones, a staunch supporter of the federal health law, said in a conference call from San Francisco.

        1. Take what action? Put non-compliant policies into the exchange? How long will that take? Will they incur tax penalties? Will people be aware that they are about to incur the fine? Do those policies still exist for sale?

          Saying it and doing it are two totally different things.

        2. And fuck this ‘request’ crap; change the damn law! I don’t do ‘requests’.

    2. “Dave Jones…carry this water…floated.”

      Hmmm…Davy Jones…that give me an idea…

  10. Does this make the renewal of non-compliant policies legal? No. The legal requirement remains on the books so the relevant health insurance plans remain illegal under federal law. The President’s decision does not change relevant state laws either.

    Contemplate this, as you twiddle your thumbs up there on the Tree of Woe:

    If you are the CEO of a large publicly traded insuror, you have been observing with great interest the recent dramas unfolding at places like Bank of America and J P Morgan. Are you willing to just blindly accept the Great and Wonderful Zero’s Presidential Assurances of Immunity regarding plainly illegal behavior?

    I think not.

  11. My view of American politics is that, for the most part, Americans are willing to put up with the lies and bullshit of the political class. Until they reach a certain tipping point of stupidity. Bill Clinton’s technical defense of what was obviously a sexually gratifying encounter for him with an intern, for example. Elected GOP officials getting hammered for lauding Strom Thurmond’s racism as principled and therefore forgivable. Bush I’s “read my lips” on taxes. I think the “if you like your insurance you can keep it” being completely false was in the same vein. No matter what Mr. Obama’s administration can or can’t do legally, he is finished as a leader.

    1. You may be right. Carter hit that wall with the Iranian hostages and got slaughtered in the next election.

      1. The hostages were a big deal and a thorn in the Carter Administration’s side.

        The “we’re not gonna put up with this level of stupidity” function came to a head after the “malaise”/”Crisis of Confidence” speech.

        At that point, Carter became a real laughing stock. It’s just that Carter’s issue was about energy and Obama’s is about healthcare.

        I remember when my Dad couldn’t buy gasoline one day because our license plate ended in an even number. Once shit like that started happening and the lines materialized, and Carter’s response was his “malaise speech”…

        That’s where Obama is right now. He’s telling us that we can’t buy gasoline today because our license plate ends in an even number. He’s asking us to make sacrifices of our health insurance policies–with no clear benefit to ourselves.

        Carter didn’t have the historical legacy of being African-American to shield him, and the fact that Obama does have that probably insulates him to some extent.

        http://www.hollywoodreporter.c…..war-623326

        But this is the spot where we should see Obama become a laughing stock.

        1. The other way Carter and Obama are alike?

          Carter probably wouldn’t have been president if it hadn’t been for all the stupid shit Nixon did, and Obama probably wouldn’t have been president if it hadn’t been for all the stupid shit Bush did.

          1. The other way Carter and Obama are alike?

            They both have white mothers?

            1. Neither of them have been in my kitchen?

              1. +1 Cliff Claven

          2. Carter probably wouldn’t have been president if it hadn’t been for all the stupid shit Nixon did[.]

            No, Ford did himself in by pardoning Nixon.

        2. Carter didn’t have the historical legacy of being African-American to shield him, and the fact that Obama does have that probably insulates him to some extent.

          Ultimately the shield is going to lead him to greater depth of idiocy than would be possible without it. As we are seeing with his Obamacare thrashing about.

    2. I thought “you didn’t build that” would be the tipping point. But once again I was disappointed by my fellow citizens.

  12. It’s just announcing it will not enforce federal law

    Having looked into this issue for reals (“when does a statement by a government official give you a defense against enforcement”), I can tell you that the President’s speech/press release/letter do not give any comfort to insurers or citizens. If any kind of enforcement action is brought or penaltax assessed, the victim will not be able to say “The President said I could” and make it stick.

    While a statement by a government official can be used as a defense, the statement has to be specific to the exact action being prosecuted, and to the exact person being prosecuted. They have to tell you, by name, that what you individually are planning to do will be okey-dokey.

    Any insurance or tax attorney who advises their client that “because the Prez said” gives them any protection is a fool and should be fired.

    1. So, it’s just purely about using the media to deflect pressure away from the president.

      1. That or the media using the president to deflect pressure away from the legislatores.

    2. This.

      Can’t you see an insuer’s legal team waving that letter in front of a court to get them to enforce an illegal contract?

      Or stapling the letter to your 1040 to get out of paying the penaltax?

    3. What if in today’s secret meeting Obama signs a secret letter addressed specifically to “Aetna”, “Blue Cross”, etc.?

      1. Then I would have to look at the law being “waived” and reach a conclusion about whether the letter provides a reasonable basis.

        In this case, I doubt it would. This usually comes up when ambiguities are being resolved or regulatory gaps filled. Its basically a way of nailing the government to a reasonable interpretation that one of their people put on agency letterhead.

        That doesn’t work here.

  13. “They have to tell you, by name, that what you individually are planning to do will be okey-dokey.”

    I don’t think even this will work, since the official saying okey-dokey still doesn’t change the law.

    1. Even thinking about this in terms of the individual mandate, just because the president instructed the IRS not penaltax anybody this year because of not owning a compliant policy, can’t the IRS still go after individuals up to seven years after the fact?

      Three years from now, Obama isn’t going to be the president. Maybe some future president will honor Obama’s decision to play screwy with the law, but unless they’re explicit about it, if you get audited some time after Obama leaves office, IRS auditors aren’t going to have the discretion to ignore the law.

      And what does this mean for businesses? If you were offering your employees a non-compliant policy and it’s going to be resurrected for another year, what happens if they’re not conforming to the law? They’re not getting any kind of special exemption. He’s just trying to give it to individuals, right?

      We keep looking at what Obama does and trying to assign his behavior to the most reasonable motive possible, but I’m starting to wonder if that’s the best approach. Maybe he’s just an ignoramus, and what we’re seeing him do doesn’t have anything to do with plausible motives. Maybe he’s just twisting in the wind.

      1. “He’s just trying to give it to individuals, right?”

        I should have written that Obama’s just trying to give this exception to insurance companies in regards to policies in the individual market.

        I don’t think he’s announced any exceptions for the individual mandate yet. Far as I can tell, you still have to pay the penaltax for a non-compliant policy. It’s just that you actually get to keep the policy.

      2. The HHS letter doesn’t say they won’t penaltax you if you continue your policy.

        1. We should really be hammering on that point:

          Obama doesn’t give a shit about people like you and me.

          That’s the way you crush the Democrats in the mid-terms.

          1. I’m all for this. But we should also be hammering on the point that the GOP hasn’t offered an alternative to replace PPACA with. Hopefully we can crush both parties in the mid-terms.

            Incidentally, my plan would be to repeal PPACA and replace it with a law that repeals all the other federal regulations, deductions and subsidies related to health care and health insurance.

            1. I’ll see and raise. Make it a capital offense, in free-range no-bag-limit style, if any judge fails to write his or her opinion as a logical proof in the manner of Euclid.

              Extend the same to any justices that sign off on the same.

      3. Maybe he’s just an ignoramus, and what we’re seeing him do doesn’t have anything to do with plausible motives. Maybe he’s just twisting in the wind.

        ^^^^^This^^^^^^

    2. We do it all the time with the IRS and SEC. It definitely is not the greatest position to put the firm or clients in, but the way the law and regs are written it is often the only way.

      1. See my comment below – enforcement of technical/ambiguous regulatory requirements.

        The SEC actually has a formal process for getting a “no-action” letter.

    3. I don’t think even this will work, since the official saying okey-dokey still doesn’t change the law.

      It can work as an “estoppel” defense if your reliance on the official was reasonable. Generally seen around technical/ambiguous regulatory enforcement.

      Even if the Prez sent a personal letter to every insurance company and taxpayer, it still might not get past the reasonableness requirement in this case.

  14. Va te faire foutre, voil? pourquoi.

    If I run this through Google translate, will it come back as, “Fuck you, that’s why.”?

    1. Oui, essentiellement.

    2. I know no French, but a fair amount of Spanish, and seeing a lot of similarities in the phrase “va te” (go, to yourself) – I’d say it’s “Go fuck yourself, that’s why”

  15. I hate to see innocent people who didn’t vote for this nonsense get hurt by losing their insurance plans, but I’m getting a healthy dose of entertainment watching this shitty administration get its just desserts.

    Not coincidentally, I’ve noticed that my prog friends on Facebook have been a LOT quieter in the last two weeks or so.

    1. Some of my prog friends have been actively complaining about the law. Just last night a guy I know who volunteered on the 2008 O campaign was complaining about:

      1. How long it took him to register on the website.

      2. Why he can’t see any plans on the website.

      3. Why the fuck the website needs to know his race.

      4. How much he needs some damn health insurance.

      Don’t get me wrong. I like the guy as a person. But it was hard to keep my “told you so”‘s in check.

      1. I’ve had this happen as well. One of my proggie friends was posting about how awesome it’s all gonna be after Oct 1. Just recently, he got a cancellation and tried to buy new insurance. Surprise, surprise, surprise, he couldn’t get far enough through the website to actually compare any plans and all estimators he’s used say his costs will more than double.

        My head almost exploded trying to keep myself from posting a “told you so” message. Especially because I have debated this turd with him in person and literally did tell him those things were going to happen to him.

        1. It’s absolutely awesome. And of course, the progs are double-talking their defense of this fiasco by pushing single=payer now, too.

          I actually had one derpgressive tell me that Medicare was running a surplus. When I pointed out to him, using government documents, that Medicare ran a deficit last year, this was his argument:

          Derpgressive: “You can’t cherry-pick one year out of the entire program! You have to take the whole time it was active!”

          Me: “So, by your logic, the US has run a deficit since the Jackson administration. I doubt you used this line of argument when discussing the Clinton “surpluses,” even though the debt went up every year of his presidency.”

          Derpgressive: “The trust fund has a surplus! Why do you not understand this?”

          Me: “The trust fund is stuffed with IOUs that have to be redeemed with government debt. The money’s gone.”

          He’s like shreik with less CHRISTFAG!!11!1!

        2. Try concern trolling him a little. the fun is in trying to slip it past him:

          “Man, I’m sorry to hear you’re having so much trouble. I was afraid this was going to happen, but I was hoping to be wrong.”

          1. You’re mean!

            …and I dig that about you!

          2. Nah, I actually like this guy and he’s starting to figure it out on his own.

            On the diehard o-care lovers posts about the subject, I’ve just been posting the “if you like your plan, you can keep it” supercut.

            1. I’ve been using ‘Hey, you won. Get over it.’

  16. There’s no sugarcoating it – no.

  17. “Insurers have a meeting at the White House today, so we’ll presumably have a better idea of where health plans stand by the end of the day.”

    And that’s really all you need to know, about how things are going with the USA.

  18. We really are living in Atlas Shrugged land, where industry top men meet secretly with gov’t top men to decide about what us rubes can and can’t buy.
    Thus clown continues to have these secret meetings and issue his lawless decrees, and half the country still says he’s trustworthy, and the media still carries his water.

  19. Is the President’s Obamacare Tweak Legal?

    “I will make it legal.” – Darth Barack

    1. “I have altered the deal, pray I do not alter it any further.”

  20. According to the President’s announcement, insurance companies will be allowed to renew policies that were in force as of October 1, 2013 for one additional year

    So, the smart money is on him doing this to push out the cancellations until after the midterms, but the midterms are in November. When does the “one additional year” end? On Oct. 1st of next year, or one year after the date of his emperial decree (Nov. 14th)? If it’s the former wouldn’t that imply that millions of people are going to once again recieve cancellation notices just a month prior to midterms?

    He’s trying to delay the pain so that the Dems don’t get killed in next year’s mid-term but it seems he may have fucked that up as well. Not that I’m surprised. This just gets funnier and funnier.

    1. I assumed the date would be 12/31/14, so no actual financial implications til after the midterms. He may be stupid, but he’s not dumb.

      1. He’s dumb enough to think insurance companies will scramble to create policies that will last exactly 1 year.

      2. Even if its for calendar year 2014, the issue is still teed up for the mid-terms. Candidate debates, ads, etc. because what happens at the end of the year will be a very live issue.

        Basically, a one year extension makes it a, if not the, midterm election issue.

        1. He doesn’t really mean “for one additional year,” he just means “for now.”

          Because ad hoc rules are ad hoc.

  21. Is the President’s Obamacare Tweak Legal?

    No, it’s not.

    Next question?

  22. Of course it is not legal, but I had to check HuffPo, and found this gem:

    Insurers have warned that they need a wide range of people signing up for coverage because premiums paid by adults in the younger and healthier group, between 18 and 35, are needed to offset the cost of carrying older and sicker customers who typically generate far more in medical bills than they contribute in premiums.

    The first set of enrollment data revealed that 106,000 people signed up for coverage nationwide, far short of the 500,000 initial sign-ups the Obama administration had expected. In states where officials discussed more detailed information, it also became apparent that the people who flocked to the exchanges after they opened Oct. 1 were those who were desperate for coverage.

    In California, the state with the largest uninsured population, most of those who applied were older people with health problems, according to a state health care official. In Kentucky, nearly 3 of 4 enrollees were over 35. In Ohio, groups helping with enrollment described many of those coming to them as older residents who lost their jobs and health coverage during the recession.

    It is almost like Reason had a crystal ball over the last few years.

  23. By the way, I caught a brief snippet of the NBC/Brian Williams newscast on this last night and there was nary a mention of the fact that the President can’t just rewrite laws at whim. Or that medical marijuana providers got shafted on a similar promise.

    They did have some talking head on assuring us that the current medical industry fiasco was not actually caused by Obamacare, though. Nope, must have just happened. Like spontaneous combustion.

    1. Science has noted that black people do on occasion spontaneously burst into flames – Richard Pryor/Michael Jackson for example. Perhaps this is an example of black legislation spontaneously combusting.

  24. “We can’t wait for Congress”

  25. Come on, when has a little thing like laws stopped Obama? We are, after all, now a government of men. Laws can simply be overridden by diktat.

  26. Is this a rhetorical question?

  27. What if someone in the DOJ decides later not to honor the President’s prosecutorial discretion? If I was an insurer, I’d worry about being outside the law, lest some change in public opinion make it easy for the government to prosecute my company later. I’m not sure that’s paranoid.

  28. Obama is about to learn that a person can’t unmake an omelet.

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