On health care, with the 2014 midterms approaching and control of the Senate in play, the administration decided to buy time by delaying the employer mandate until after the elections. Former HHS spokesman Nick Papas said the delay was “about minimizing paperwork, not politics.” But it’s awfully politically convenient to delay implementation of a law that’s been growing more unpopular and whose implementation is shaping up to be a “train wreck,” in the words of Senate Finance Committee Chairman Max Baucus, a Democrat.
Obama’s second-term legacy is shaping up to be more about avoiding crises than accomplishing big things.
Because McCain supported this policy, Obama had to attack it. This is standard politics, and Sen. Obama, despite his talk of Hope & Change, was a standard politician. Obama savaged McCain for this, accusing him of trying to “shred” the employer-based system. Such shredding would be beneficial, but McCain was unequipped to make that argument.
So, candidate Obama positioned himself as the champion of employer-based insurance.
Then came the cozy corporate-union-think tank cooperation. Liberal blogger Matt Yglesias proclaimed ”change is in the air” when the largest private-sector employer, Wal-Mart, teamed up with “Obama’s union,” the SEIU, and Wal-Mart-funded Center for American Progress to back the employer mandate…
But McCain and Ezra Klein were right, and CAP, SEIU and Wal-Mart were wrong: Propping up the employer-based system and adding to the hiring penalty is bad policy. On one side was good policy. On the other side was political opportunity and corporate alliances. So we got bad policy.
It shows that when it comes to the health care law—the president’s signature legislative accomplishment—the administration can’t win.
The White House appeased an angry business community with its decision to postpone a requirement that large employers offer their workers health insurance or pay a fine. The rule had angered even businesses that already insure their workers. It gave Republican opponents ammunition to attack the law, claiming it slowed economic growth. Its delay is likely to quiet some of those particular critiques, at least until after the 2014 election…
But the new attack line is still likely to fit into overall Republican critiques of the health care law: that it is too massive and poorly written to be practical. The inevitable hiccups in the early months of the law’s implementation—what President Obama has called “glitches and bumps”—will also fit neatly into this narrative of government overreach.
One of the main ways that President Obama’s health care law plans to expand insurance coverage is by offering subsidies for individuals to purchase insurance on government-run exchanges. There are a number of eligibility requirements attached to the subsidies such as income level and immigration status. But another fundamental requirement is that applicants for federal subsidies must be able to show their employer does not offer health insurance that meets the federal government’s standards for affordability and breadth of benefits. If the employer offers qualifying health insurance, then the worker is not eligible.
Yet in its Tuesday announcement, the Treasury Department said it was not only delaying the implementation of the employer mandate, but also the employer insurance reporting requirements. If the Obama administration won’t be making judgments on whether employers are meeting the requirements of Obamacare, how can it assess individuals’ eligibility to receive subsidies to purchase insurance on the exchanges?
“This action raises a lot of questions about whether the Obama administration can simply ignore the law when it’s convenient for them,” [Rep. Phil] Roe said in a press release Wednesday. “I have asked Congress’s research arm to investigate because I don’t think any president has the authority to pick and choose what parts of law to follow.”
On Tuesday, just hours after the administration announced in a blog post that it would delay the employer mandate until 2015, Oversight and Government Reform Chairman Darrell Issa issued a press release saying it was “unclear” whether Obama has the authority to do this without Congress.
“This is another in a string of extra legal actions taken by his administration to mask the horrible impact his law will have on the economy and health care in the United States,” Issa said.
“It does represent the inability of the administration to implement the law as planned,” said Robert Blendon of the Harvard School of Public Health. “The big question now is whether they’re still going to require individuals to pay a penalty if they don’t obtain coverage, if they’re not going to require it of businesses.”
Administration officials say the change affects less than 5 percent of businesses, as the overwhelming majority of employers already provide health coverage. But that could still involve as many as 10,000 businesses and hundreds of thousands of workers, according to reform advocates.
“It’s going to be really hard to impose the individual mandate without an employer mandate. And if you cut that, you could see the whole thing start to unravel,” said Katie Mahoney, executive director of the powerful U.S. Chamber of Commerce.
Congress could come behind Obama and vote to delay the mandate. “The president doesn’t have the power to do this, he has to come to Congress,” one Republican Senate aide, willing to discuss the issue on background, told the Washington Examiner. “If he doesn’t like what’s in his own law, fine, but you have to come to Congress to change it.”
Such a vote might force Democrats either to acknowledge that the law isn’t ready for prime-time or vote down President Obama’s latest policy decision.
“The problem is that with the 60-vote threshold in the Senate, it would give vulnerable Democrats a cover vote,” the aide said. “We’d have two votes: one to delay it just for businesses, one to delay it for everyone, and the one for businesses will pass with 60 votes+ and the second one would fail, but it would give 10 [or] 12 Democrats a cover vote, but it still wouldn’t pass.” They’d have to have two votes because Senate Majority Leader Harry Reid, D-Nev., would “never agree to do just the one vote” to delay both the employer mandate and the individual mandate.
Republicans don’t want to give vulnerable, red-state Democrats the ability to claim that they voted in favor of a temporary “repeal” of Obamacare that never had a chance to pass after they voted in favor of the law when it first came up and opposed full repeal earlier this year.
This move was clearly political, not technical. The administration believes that having the law fully in place before the midterm would be a political disaster. It prefers to fight the next election with the law still impending rather than fully operational. This is very telling: Obama would rather deal with the fear, the rumors, the nasty innuendoes about how the law works than with the harsh reality of a functioning law.
The fact that this preference is rational is the scary part…
[T]his delay—especially if it is extended or made permanent, as many hope—will put more pressure on the individual insurance exchanges. More employers could now choose to dump their employees onto the exchanges rather than pay for the premium increases many expect under the ACA. More people on exchanges instead of on employer-based insurance might be a desirable result in the long term, but in the short term it will cost the taxpayers more than previously projected. A major rationale for the employer mandate was to keep the number of people on the exchanges to a minimum, lowering the total cost of the law. If the mandate is repealed and the costs balloon, Obama may do no more than trade employer opposition to the ACA for taxpayer opposition.
This concession on the employer mandate also makes other concessions more likely: The administration will certainly face added pressure to ignore various taxes, rules, and mandates that can be shown to have detrimental effects on the economy or on some constituency—and pretty much every line of Obamacare falls into that category in one way or another. They have just announced that they can implement or ignore whatever portions of the law they wish, and so will be feeling lots of pressure from lots of people with lots views about lots of provisions…
In all these ways, I think the administration has just made its Obamacare problems worse rather than alleviating them. But it may have opened a path to alleviating the country’s Obamacare problem, by elevating the idea of delay. Opponents of Obamacare should not imagine that the law will just collapse by itself or that as problems arise Democrats will come to them asking for repeal. That’s just ridiculous. They should look for ways to make the most of opportunities to avert the implementation of this odious law and advance the cause of ultimately repealing and replacing it. And yesterday’s announcement offers such an opportunity. The employer mandate is very bad policy, and its delay (which likely means its elimination) is a good thing. But the rest of Obamacare is very bad policy too. The delay of the employer mandate by a year highlights the irrationality of the larger law and exacerbates its instability. It does not seem to be sustainable as a discrete measure. It calls at the very least for a broader delay.
The law will not be any better a year from now, but since Democrats remain staunchly opposed to any talk of repeal yet now have to be open to talk of delay, Republicans should move to delay implementation of the entire law by a year. I’ve argued before (as others have) that delay offers both sides some near-term benefits—though in the long run I think it advances the cause of replacing this law with real health-care reform. With yesterday’s announcement, the administration has once again proven that near-term benefits are all the president cares about. So fine—let’s delay, let’s use the time to better frame a serious alternative for the country, and let’s see where we are a year from now.
We knew that it was going to be very hard, and his view was, look, the system’s imploding, the inflation and health care cost is going on unabated. It’s ultimately going to collapse, not just the government but families and businesses. And if we don’t do something about it, we’re — we are negligent as leaders. And so yes, we knew the optics were not going to be good along the way that, there were going to be political burdens. Yet he took it on anyway and I’m proud of him for doing it.
One other point I would make is, and we’re all guilty of this, we tend to judge these things along the way. Every day in Washington’s election day. We tend to judge these things on the basis of what’s happening at that moment. His view is that we ought to plow forward, make this work, and we’re going to look back at it and it’s going to be our proudest accomplishment. But it’s going to take time. If you’re worried about optics at any given moment, then you’re not going to accomplish very much in public office.