Via Jim Geraghty, this makes at least three Democrats within the past 24 hours who are now talking openly about some form of delay. Erika covered Jeanne Shaheen’s call for delaying the deadline for enrollment last night. House Democrat Bill Pascrell said this after this morning’s ObamaCare briefing by the White House:
Dem Rep. Bill Pascrell after Obamacare briefing: If problems persist, he may be open to considering delaying the individual mandate.
— Chris Moody (@Chris_Moody) October 23, 2013
Debbie sounds fine with extending the enrollment period too, saying, “I don’t think there’s anything wrong with that.” There isn’t? Megan McArdle:
Extending the open enrollment period: This idea has a number of big problems. For starters, it’s probably not legal. Also, it’s useless without extending the individual mandate: Who wants to find out that they’re liable for both insurance premiums and the penalty for being uninsured? But it would also be very, very bad for the insurance market.
I pointed out a while back that one conservative talking point — that people can just wait until they get sick, and then buy insurance — is incorrect. It’s incorrect because we have an open enrollment period: If you get sick in April, you have to wait until next January to get insured again. Oh, you can game it a bit (if you move to a different state, for example, you become eligible to buy insurance outside the open enrollment period). Even so, this provides a pretty powerful incentive to get insured and stay insured: After all, how many people can easily switch states?
But if the open enrollment period is extended, then suddenly it makes total sense to wait, especially if the individual mandate also gets delayed. And who’s most likely to wait? Say it with me: young, healthy people who rarely go to the doctor — exactly the people we need to get into the system immediately to keep it financially stable.
Insurance industry death spiral. Which makes me wonder: Do the Democrats who’ve been championing this law actually know how it works? It’s one thing for someone like Rubio to push the idea of delaying the mandate knowing that his proposal will go nowhere; it’s a crafty way to put Dems on the defensive politically. But now Democrats themselves are murmuring about delaying enrollment, which risks the same too many sick/not enough healthy financial nightmare for insurance companies, as a viable solution. It’s not viable. It’s not even viable if you subscribe to the “liberals designed ObamaCare to fail” theory. Even if that’s true, they wouldn’t design it to fail so badly that it might shake the public’s faith in liberal technocracy; that makes the goal of eventually selling people on single-payer harder, not easier. And they wouldn’t design it to fail immediately, when the public’s still skeptical of ObamaCare. To build support for greater statist control of health care, they need to impress people by showing that their contraption can run smoothly for awhile. Then, years from now, when they have a majority in Congress again, they can start touting single-payer as the key to lowering health-care costs for everyone. A meltdown on the federal exchange right out of the gate followed by skyrocketing premiums nationwide as the industry copes with the death spiral is … not helpful to that project. Which brings me back to my question. What are Shaheen, Pascrell, and Wasserman-Schultz doing touting a partial solution that’s apt to lead to the worst-case scenario? If you can’t fix the website immediately, your only option is to delay the law in its entirety so that insurers aren’t stuck figuring out a way to pay for preexisting conditions next year with no new revenue.
Actually, says Conn Carroll, there may be a way involving the “risk corridor” provisions of ObamaCare to delay the mandate and avoid an industry death spiral. Hint: It involves your wallet.
[I]f the actual cost of providing health care for the people who sign up for Obamacare is more expensive than the insurance companies thought it would be, then HHS will pay insurers the difference. They can’t lose!
And where will HHS get this money?
Well, the CBO scored the risk corridor program as budget neutral when Obamacare passed, reasoning that while some insurers would underestimate cots, others would overestimate them, and the overestimaters would be forced to pay the difference to HHS. CBO just figured the overestimaters and the underestimaters would cancel each other out.
But if everyone underestimated the cost of insuring people through Obamacare, then the money to cover insurance company losses will come straight from taxpayers. It could be the biggest taxpayer bailout of the insurance industry ever.
If there’s a shortfall among insurers, the feds will simply borrow an extra few billion to make them whole. Or, if Democrats figure out a way to take back the House, maybe there’ll be a brand new tax next year to pay for the bailout. They could have built ObamaCare that way from the start, in fact, if they wanted to cover preexisting conditions for sick people. Tax everyone, and tax the free-riding uninsured who can afford insurance but choose not to buy it a little extra. But they don’t like being seen as the “tax party” so they stuck us with this Rube Goldberg machine instead that’ll likely end up effectively taxing everyone anyway. See? John Roberts was right after all.
Update: No dice on extending enrollment says Pelosi. Is that because, unlike many of her colleagues, she grasps the death-spiral consequences of doing so? Or is this simply her refusing to give an inch to Republicans on her biggest “achievement” as Speaker?
“I don’t support that,” House Minority Leader Nancy Pelosi said Wednesday morning, just hours after Sen. Jeanne Shaheen of New Hampshire appeared to be the first Democrat in Congress to join a growing number of her Republican colleagues in suggesting the deadline be pushed back…
Pelosi, the former House Speaker, disagreed, adding that “I think we should fix what we have. Move forward with the deadline we have, respectful of what her (Shaheen’s) experience may be, of her suggestion, but not supportive of it.”