Quotes of the day

Six months into his second term, the momentum that President Obama gained from his reelection win is a fading memory…

No achievement is more important than the Affordable Care Act, now more widely known as ObamaCare. This, in turn, explains why the recent decision to delay the requirement for employers to provide healthcare for their workers was met with such consternation, even from people who support the administration.

“Look, I know it’s a complicated law with many levers and buttons, but they should have had all this figured out before it appeared like it was ready to go,” one former administration official said. “It’s a good law, it will help so many people who need it, but it looks sloppy.”

The danger for Obama is that people’s faith both in him personally and in the more activist role of government that he favors will decline.


One of the biggest administrative hurdles facing Obamacare was the ambitious plan to verify the income and insurance status of applicants for federal health coverage subsidies. In theory, on Oct. 1 of this year, a prospective beneficiary of Obamacare was supposed to be able to visit a website like Orbitz, enter basic information, and wait as multiple state and federal government databases communicated with one another to confirm in real time the applicant’s income level, and then display the level of subsidy to which the applicant was entitled, if any. It was a level of technological sophistication unlike anything ever attempted by the government. Now, with less than three months to go before Obamacare’s health insurance exchanges are set to begin enrolling applicants, Obama’s Department of Health and Human Services is throwing up its hands. Just as it did with the employer mandate, the administration has announced it would delay the implementation of these anti-fraud procedures due to the administrative difficulty…

With this news coming after the employer mandate delay announcement, the Obama administration has now openly conceded that it is in way over its head when it comes to implementing this unworkable law. Thus, the new strategy is to simply set up a mechanism to feed taxpayer subsidies to as many Americans as possible so that even if Obamacare is a complete train wreck, it will make enough people dependent on government to make repeal politically impossible. Republicans should seize on this immediately, and force the administration to defend a policy that would open the floodgates to fraud.


The administration is trying to portray the change as a small adjustment in an otherwise inevitable implementation of the law when what was announced completely discredits what the administration had been telling everyone for months. The real story here is that the exchange roll-out has reached the point of administrative collapse, and the administration is doing everything it can to hide that fact.

Second, moving to the “honor system” is consistent with the administration’s larger objective at this point, which is to salvage Obamacare by shuffling as many people as they can into the subsidized insurance program. Hence the outreach to professional sports leagues, librarians, and others to help publicize enrollment in Obamacare. The abandonment of income verification allows the administration and the states to move to a “sign ‘em up now, answer questions later” approach, with the likelihood that erroneous payments made in 2014 will be gone forever. Why wouldn’t the administration find a way to waive collection of overpaid subsidies? They’ve waived everything else that is inconvenient.


Liberals are also now claiming that the employer mandate and these eligibility rules were never important parts of ObamaCare. This is revisionist history, not least because the mandate and eligibility limits helped reduce the cost as measured by the Congressional Budget Office.

The revisionism is also false because every provision of ObamaCare is supposed to “solve” a problem created by some other provision of the bill. Kick out one of the struts like the business mandate and the whole apparatus becomes even more unstable. In the case of the lawless decision to shelve any income or employer insurance scrutiny, HHS’s logistical challenges are real. But our bet is that the Administration is also using them as a pretense in a deliberate bid to make it much easier to join the exchanges.

That’s because the health planners are terrified that enough healthy, low-cost people won’t sign up and therefore the Affordable Care Act’s strict regulations on underwriting and risk-pooling will blow up insurance markets. As more and more of ObamaCare tumbles, the Administration is resorting to anything that can salvage the goal of permanently expanding the U.S. entitlement state.

All of this fits with ObamaCare’s entire bloody-minded history. Democrats were determined to make their rendezvous with the liberal destiny of government-run health care, so they imposed this debacle on the country on a partisan vote and despite public opposition. Now that they are discovering how difficult it is to remake one-sixth of the U.S. economy, they are rewriting the law as they go and telling Americans they have no choice but to live with the consequences.


So now we finally have the answer we’ve been waiting for about the failed implementation of the massive data verification system they have been building to serve the exchange model: never mind. The government’s inability to build a system which interfaces with states and takes the necessary steps to check for eligibility has led the Obama administration to just throw in the towel for at least the first year. And this serves their aims in multiple ways: first, it makes it much easier to sign as many people up as possible to avoid rate shock, which is what they’re worried about; second, it means the administration allies can target their sign-up efforts on the 16 states where no verification is necessary; and third, it creates as significant a subsidy constituency as possible prior to the problems we’re likely to see during rollout.

Of course, the incentives it creates are completely warped. A modest lie about your income can push people who would’ve been on Medicaid, most of whom don’t file tax returns, to the far more generous exchange subsidies. The resemblance to the “Liar’s Loans” approach to the housing market collapse is uncanny. Never mind that CBO never scored an “honor system” version of Obamacare, or that the authority for such a step is dubious at best. House Republicans are certainly going to come back into town yelling to high heaven that the delays of the employer mandate and any eligibility checks amounts to a remarkable rejection of the rule of law. And many Democrats are quietly admitting that this implementation effort has turned into a giant cluster. But I see no incentive on the Obama administration’s part to go along with efforts to delay the law for a year, even though such a step would be more responsible.

Here is where the technocrat’s mask slips, and the ideologue smiles through. If the Obama team can get away with picking and choosing what parts get implemented and when, flaunting the law to satisfy their electoral aims, why not do it? Who cares if it explodes so many of the promises made during the law’s passage? (Of course, don’t think too hard about what the press would be saying if a Romney administration was undertaking similar steps.) Josh Kraushaar argues that Obama’s facing a crisis of competence. But who cares about competence so long as the lights go on for the one major domestic policy of Obama’s tenure? Give me implementation, or give me death.


The administration’s contortions in implementing Obamacare have to be understood in light of the fact that only the administration itself really knows how implementation is going. No one else has anything approaching a complete picture, and particularly not regarding the development of the exchanges. The status of the federally-run exchanges, even more than those to be run by the states, remains simply a mystery. The administration has shared scant little information with the public, and even an investigation by the Government Accountability Office (an arm of the Congress) concluded last month that the likelihood that the exchanges will be ready to launch in October as required by law “cannot yet be determined.” The various delays and rule changes announced by the administration are responses to problems they are finding in the process of implementation, and the shape of those responses is among the only clues we have to the shape of the problems they see.

The delay of the employer mandate announced on Tuesday and the delay of the verification requirements for eligibility announced on Friday both suggest the same two kinds of problems: logistical difficulties with getting complex systems into place, and the fear of ending up with too few people in the exchanges…

Opening the door wide open to fraud could well increase the number of people in the exchanges, but it will also make that number far less meaningful—casting a shadow over whatever is achieved by the enrollment effort set to launch in the fall. It will also, needless to say, increase the cost of the exchange subsidies. The administration is clearly worried enough about enrollment to take that risk and bear that cost. It seems to be operating under the assumption that the way to secure Obamacare’s future is to get as many people as possible into the system and receiving subsidies. Maybe they’re right, and maybe they’re wrong, but they certainly seem increasingly desperate.


If Republicans were smart, they’d draft a bill based on the following mantra: “No Subsidization Without Verification.” That is, they should take a stand that nobody can receive subsidies through Obamacare before the government has a system in place that can independently verify the information as accurate…

Of course, Obama and his fellow Democrats would likely block such an attempt by Republicans. If they do so, they will be put into the position of explaining to the American people why they are willing to hand out a over a trillion dollars of taxpayer subsidies without proper procedures in place to prevent fraud. Preventing fraud in government programs can easily be a 70/30 issue with the American public. What makes this an especially indefensible position for Obama and Congressional Democrats is that they are already on record supporting tougher anti-fraud measures than the ones HHS just adopted, which is why they were originally a part of Obamacare. These anti-fraud measures are only being abandoned in the mad rush to shove as much taxpayer money out the door as quickly as possible.

If Republicans want to raise the stakes, they should consider making this a part of the fall budget battle.


Look. If there’s a law that should be delayed that people like, no politician is going to delay that law. I mean, I don’t care if you’re going to send a whole building underwater and have it disintegrate. If people like it, they aren’t delaying it before an election. That’s the whole reason–. The administration feels a lot of pressure here to get this right and why they’d rather delay before an election than end up with a lot of people extremely upset with the way this big huge piece of legislation goes into effect.


“You had even Democrats saying that implementing Obamacare has the potential to be train wreck,” Klein said. “Well, now you have the prospect of a slow-motion train wreck. Here’s the thing about this particular provision. This effects thousands of workers, maybe, not the millions of workers who are going to be impacted over the long haul on this. So if you couldn’t even even get this piece of it right, after a three year ramp-up period, just to put in this tiny slice of Obamacare?”