Another ObamaCare delay — and giveaway
posted at 9:51 pm on August 28, 2013 by Ed Morrissey
Unlike some of the earlier delays, the latest deadline miss from HHS will not have too much impact on the rollout of ObamaCare — assuming it’s as easily resolved as HHS thinks. Finalized agreements with the insurers competing in federal exchanges won’t be executed until a couple of weeks past the deadline, which may mean that some exchanges won’t be able to feature the plans at the October 1st deadline:
The Obama administration has delayed a step crucial to the launch of the new healthcare law, the signing of final agreements with insurance plans to be sold on federal health insurance exchanges starting October 1.
The U.S. Department of Health and Human Services (HHS) notified insurance companies on Tuesday that it would not sign final agreements with the plans between September 5 and 9, as originally anticipated, but would wait until mid-September instead, according to insurance industry sources. …
The reason for the hold-up was unclear. Sources attributed it to technology problems involving the display of insurance products within the federal information technology system.
Peters said only that the government was responding to “feedback” from the companies, “providing additional flexibility and time to handle technical requests.”
This isn’t postponing key enforcement provisions, as the White House has unilaterally decided to do with employer and insurer mandates, although it should. HHS has had more than three years to work out the requirements for exchanges with insurers, and the fact that they can’t execute the agreements nor feature the plan data properly should be big red flags about the readiness to enforce the individual mandate and pay out the subsidies. With other parts of the system non-functional, such as bilingual services and income verification, this is just another reminder that ObamaCare exchanges are going to short consumers on information and informed plan choice required by the mandate, as well as put them at risk for identity theft.
The news isn’t all bad this week. Reuters reported yesterday (through Newsmax) that one key constituency won’t have to worry about the mandates in ObamaCare …. the unions:
Backers of the law say that, unlike the employer mandate, the individual mandate is essential to ensure enough individuals are enrolled in the system to allow the online marketplaces to function.
The rules announced on Tuesday offered good news to employees getting health coverage through a union-sponsored plan. They clarify that these employees will not be penalized, said tax lawyers who reviewed the rules on Tuesday.
Many union plans didn’t meet the requirements of the ACA, either offering too little coverage, or more often, too much — making them “Cadillac plans” subject to penalties. While this blurb is a bit vague, it appears that HHS has taken the heat off of the unions by deciding not to enforce those mandate requirements on union plans. It’s not clear whether this addresses the other union demand to make those in these plans eligible for federal health-insurance subsidies. If not, and it doesn’t seem to mean that from Reuters’ reporting, then the AFL-CIO complaint that employees will bail out of their plans to go into the exchanges still looks like a real problem for unions that derive plenty of income from their insurance plans.
The other issue that has unions belatedly balking at ObamaCare is the erosion of full-time work. Frobes’ Grace-Marie Turner argued yesterday that this was a real problem, corroborated by real data and not just anecdotes, and explains why delaying the employer mandate didn’t make a bit of difference:
Bureau of Labor Statistics data show that the ratio of part-time to full-time jobs has completely flipped this year from historical trends. Last year, six full-time jobs were created for every one part time job. This year, only one full-time job is being created for every four new part-time jobs.
The shift to part-time has accelerated over the past several months because of the “look back” provision in ObamaCare that sets the baseline this year for the number of full-time workers a company employs to determine their compliance with the employer pay-or-play mandate.
The administration may have been trying to stop the damage when it announced in July it would delay for a year the reporting requirements for the health law’s employer mandate – the requirement that businesses with 50 or more employees provide health coverage that is acceptable to the government or pay a fine of $2,000 to $3,000 per employee per year.
The statute is very clear that the employer mandate is to take effect on January 1, 2014, not a year later as the White House now has directed. The House of Representatives was more than happy to give the administration legal authority to delay the employer mandate and passed legislation in July to make the delay legal. But, astonishingly, the president vowed to veto the legislation if it were to reach his desk – which it will not because Senate Democratic leader Harry Reid will not bring it up for a vote. The president would rather rewrite the law by administrative edict instead of following the Constitutional route of asking Congress to change it.
The damage is real, and the one-year delay is unlikely to have a significant impact on hiring. Businesses are not going to hire full-time workers for year or less only to have to fire them next year.
Delaying the enforcement doesn’t change the “look-back” time frame at all. Obama would have to change the statute to do that — as he should have done with the mandate deadline as well. Businesses clearly aren’t taking any chances, and as Turner writes, they aren’t going to create full-time jobs this year just to lay people off next year.
Addendum: Be sure to read Paul Hsieh’s analysis of how ObamaCare values a human life.