Say hello to your pre-holiday, late-week, kitchen-sink news dump. Kevin wrote about the administration's new batch of staggering last-minute decrees last night, and Avik Roy has additional details here. The brand new regulations will offer two new options for people whose plans have been canceled due to Obamacare: First, this group will now have the opportunity to purchase "catastrophic" coverage that was previously reserved for people under the age of 30. This might sound like a great deal, but it's not. Roy points out that people on catastrophic plans are ineligible for any subsidies, and liberal Jonathan Cohn notes that these plans aren't significantly cheaper than Obamacare's "Bronze" plans. Also, will people who do sign up for the catastrophic plans be yanked off of them when the exemption expires next year, in yet another "keep your plan" violation? Second, the dumped coverage crowd will be free to claim a self-reported "hardship" exemption from the individual mandate tax altogether in 2014. A few thoughts:
(1) These hardship exemptions apply to perhaps millions of Americans who are newly uninsured because of Obamacare. Note well that the "hardship" here is not technical or enrollment troubles with the exchange websites. Instead, the new category of hardship applies to those who "believe" they cannot afford the law's new rates. This is the administration's first high-profile admission that the 'Affordable' Care Act is in fact unaffordable for huge swaths of Americans. So damning. On a logistical level, it will be somewhat complicated to keep track of who genuinely falls within this group, and it will be impossible to determine if claims of self-reported financial hardship are well-founded. It appears there will be no attempt by the government to verify claimants' financial status. Incidentally, Kaiser Health News reports today that people on employer-based plans should brace for significant cost increases next year. And that doesn't even take into consideration the massive "disruptions" (ie, insurers pulling out of exchanges and additional premium spikes) triggered by these new on-the-fly rule changes. And don't forget that some large number of Americans with employer-based plans will lose their coverage ahead of the employer mandate kicking in. That mandate was unilaterally delayed by the president until 2015.
(2) In the previous item, we described how the administration is conceding that Obamacare itself, and specifically its high costs, is a "hardship" for millions. With that in mind, how can they justify not extending the same waiver to all uninsured people? Or all Americans, for that matter? Yes, people who've been dumped from their existing coverage are the immediate victims of Obamacare's most visible (for now) broken promise -- but if the administration is acknowledging that Obamacare's supposedly affordable coverage really isn't as advertised, that's not a problem that's unique to the newly uninsured. It applies to everybody affected by the law. Ezra Klein frets that this delay could be the camel's nose under the tent on delaying the individual mandate tax even further. Republicans will argue, convincingly, that it's a matter of fairness. Why waive the penalty/tax associated with not buying (unaffordable) coverage for some untold percentage of the population, but not for everyone else? The whole ostensible purpose of Obamacare was to assist a group of millions of Americans who couldn't afford health coverage prior to the law's passage. As of now, those people will still be subjected to the individual mandate tax, whereas people who were insured before Obamacare uprooted their arrangements will enjoy exemptions. Is that politically sustainable? Policy-wise, the more people who are granted passes on the individual mandate, the worse the risk pool's "adverse selection" problem gets. This is a disaster for the law, and is already creating migrane headaches for insurers, who are trying to keep their heads above water as a panicked White House lobs new bombs at them every few days. Their warnings of coming "disruptions" are euphemistic.
(3) With his signature law in utter shambles -- and with millions of Americans deeply worried about their healthcare situation as a result of its technological and substantive failures -- President Obama is about to embark on a 17 day Hawaiian vacation. Is he aware that two state-level Obamacare exchange directors have resigned over taking ill-timed tropical vacations within the last two weeks? Here is the man who is more responsible for Obamacare than literally any other human being on the planet shipping off to paradise, leaving others to grapple with the consequences of the mess he's leaving behind. It's tough to discern which is worse: The optics or the leadership.
(4) At what point do ardent supporters of this law wave the white flag and change their tune on repeal -- or at least a one-year delay? A new poll shows that a majority of Americans support scrapping the entire law, and an overwhelming super-majority would back a comprehensive postponement until 2015. On a practical level, the full delay isn't feasible at this stage, and various "fixes" would only erode its underpinnings. Don't forget that Democrats were offered an opportunity to get a desperately-needed delay in September, but they rejected that political bailout in order to shut down the government and blame the GOP. Are any of them regretting that short-sighted decision, which merely delivered a transient pyrrhic victory? In order for these same Democrats to resist growing calls for sweeping delays, they'll have to explain the concepts or risk pools and death spirals -- wonk talk that won't move many voters. They've created a real hot mess for themselves, and the White House's latest maneuverings only create more instability.
(5) I would be remiss if I didn't mention another hugely important Obamacare story that is developing today -- which, if not for everything else we've just discussed, would be the top headline. ABC News is reporting that two separate internal reviews have elicited findings of "high" data security risks associated with the Obamacare website, and that "nearly three months after its launch and as millions of Americans log on to shop for health plans, HealthCare.gov has still had serious security vulnerabilities." One of these security gaps was just uncovered last week. CBS News quotes an administration official who says she recommended that the site be taken off-line until the risks had been dealt with, but was overruled by higher-ups. Why? Who made those reckless calls? Remember, other Obamacare IT workers had fired off memos warning of "limitless risks" associated with the site, and expert hackers told Congress that Healthcare.gov should be taken down until the myriad vulnerabilities were resolved. That didn't happen, and Americans are being asked to plug their sensitive data into a website that still isn't secure. The finger-pointing has commenced. As Allahpundit says, "it's subpoena time." Darrell Issa is going to be a busy man in 2014:
I'll leave you with this image, which is how the front page of Healthcare.gov looked earlier this afternoon:
Time Stamp. pic.twitter.com/ilqdOejjSm— Noah Rothman (@NoahCRothman) December 20, 2013