More cancelled health plans. Millions and perhaps tens of millions more Americans will lose their coverage, despite the White House’s one-year suspension of the mandates that force insurers to liquidate their old products. The problem is backloaded.
The wave would have been worse if not for a loophole that allowed early renewals: If people renewed their 2013 plans early, they could keep them in 2014 without complying with the mandates. Some 42 states allowed this loophole, but it only lasts through next November.
Small business insurance disruption. Thus far the cancellations have been largely contained in the individual market but will soon spread to small businesses. Companies with 50 employers or fewer were more likely to choose or to qualify for locking in their old benefits. They’re next on the cancellation block when the dispensation runs out.
The fear that businesses will dump their workers onto the exchanges remains, given the law’s strong incentives to do so. But the exchanges are so dysfunctional that this outcome is unlikely soon. Taxpayers are being saved for now by White House incompetence.