But there is also more going on here. 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 individual 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.
The first of these is straightforward enough, and has tended to be the public reason offered for these delays. But the second is clearly also a major concern for champions of the law. If not enough people sign up for the exchanges, the system could end up with an insufficient and unsustainable insurance pool—too few healthy people to balance the sick ones and fund the cost of their care. The premium shock—that is, the fact that relatively healthy people will face much higher insurance premiums under the new system than they face today—that looks likely to be prevalent in the exchanges in almost every state could well drive younger and healthier people away, the penalty for remaining uninsured (the so-called “individual mandate”) may not be high enough at first to keep them in the system, and many people may also be inclined to wait and see how the exchanges shape up before they join.