Friday, December 20, 2013

Obamacare Now Serves as the 'Hardship' Exempting a Person from Having to Comply with Obamacare

Yes, you read that headline correctly.  PPACA's minimum benefit requirements forced five to six million private health insurance policies, covering as many as ten to twelve million people to be cancelled because they do not meet all of the minimum standards prescribed by Obamacare.  

But now, because the PPACA Exchange websites were not working and are riddled with security leaks and because insurers and states have not all been able to reverse course on a dime and "de-ungrandfather" all of those millions of policies that PPACA mandated they cancel we have the 14th different ad hock, unilateral amendment to the President's Health Law.  

In a December 19 regulatory pronouncement by blogpost Health and Human Services (HHS)  has changed the rules in a comedically delightful way. 

Obamacare can now serve as the 'hardship' that exempts a person from having to comply with Obamacare.  Ponder that one for a few moments as you enjoy a cup of spiced eggnog this Christmas Season.  

If you believe [ah yes, you have to love those purely subjective legal standards such as one's own belief or feeeeeeeling] that the plan options available in the Marketplace in your area are more expensive than your cancelled health insurance policy, you will be eligible for catastrophic coverage. ... 
Oh I believe. Yes I believe!  Obamacare's rollout obliterates the rule of law.  The absurd supplanted the unlawful in November and now the Christmas Season brings us to a numb state of utter disbelief with nutmegy and pepperminty tinge of hilarity. 

The Latest Executive Degree Means

In short, if you are one of the five to six million policy holders (covering as many as ten to twelve million people) who have lost a plan and you feel that the standard Obamacare plan in your area is unaffordable you can now quality for a catastrophic (cheaper) plan even if you are over 30 years old.  By law, these plans are only available people under the age of 30; but who in the executive branch still holds to the antiquated notion of 'rule of law' anyway? When remaking one-sixth of the U.S. economy, the illuminati certainly need leeway to pronounce new laws as they see fit.  

This causes mass confusion and another administrative debacle two business days before individuals were to secure their 2014 Exchange coverage.  It also wreaks of desperation. 

As you can imagine, insurers are not feeling festive over the President's latest holiday game-changer.  These ten to twelve million people were underwritten to pay higher premiums for Exchange insurers to cover the higher cost patients rolling on in 2014 with no pre-existing condition limitations.  Instead, more young and healthy will be exempted or shuffled over to the catastrophic plans worsening the risk pool in the Exchanges.  

We discussed this on the air back in July.  The Individual Mandate is too unpopular for any one political party to own.  With this latest exemption we are now up to twenty-two different ways for a person to exempt themselves from that mandate.  Back in June before these latest exemptions were created magically out of thin air the Congressional Budget Office stated that only two percent of Americans would ever actually pay the Individual Mandate.  With the last couple additions to that exemption list, we are well under one-percent of Americans who will ever pay it. 

In fact, the White House won't say whether anyone will have to pay the Individual Mandate in 2014.  This is from Daniel Halper at the Weekly Standard:   

"Is there going to be a single person in 2014 that's going to pay the penalty? A single uninsured American that is going to end up paying the penalty in 2014 at this point?," asked MSNBC host Chuck Todd. 
"Chuck, I can't talk to you about how many people are going to be subject to the penalty," said White House deputy senior advisor David Simas, sidestepping the question. "I can say that in Massachusetts, you saw a rapid decrease in the number of uninsured because when they had choices, people signed up. And that's what we're seeing today."
Had the administration listened to our projections on the Armstrong and Getty Show in July when we noted that the Individual Mandate was functionally dead it would be better off because it would have buried the individual mandate permanently instead of this never-ending barrage of exceptions and exemptions. They are putting band-aids on a broken arm and it will not work. 

This Action Raises a Number of Questions
  1. Why are people whose plans were canceled more deserving of help than people who couldn't afford a plan in the first place?  
  2. Why should people who lost their plan be the only ones with special permission to access a catastrophic plan (or what was called a substandard plan two days ago)?
  3. Wouldn't it have just been easier to refrain from meddling in individual's choices in the first place?  I know, silly notion. And, 
  4. Why exactly did the Administration spend millions of dollars and thousands of hours litigating the legality of the Individual Mandate all the way up to the Supreme Court just so they could systematically gut it to a point where it will apply to less than 1% of Americans?
Put simply, ten million Americans were forced off of the health plans they liked and chose because the government deemed those plans 'substandard' for the poor Subjects who just did not know any better.  But the Ruling Class was unable to set up and deliver the plans they deemed the Subjects should have.  So now the Ruling Class is granting permission to the Subjects to go ahead and buy those substandard plans again.  Meanwhile, the best projections have ten million people losing care in 2014 while only about two million will gain it under the Rube Goldberg Machine of Obamacare.

Other Coverage and Resources  
  • You can read HHS Secretary Kathleen Sebelius' full letter to the Senate on this decision here. HHS's formal guidance is here.
  • Utter Chaos: White House Exempts Millions From Obamacare's Insurance Mandate, 'Unaffordable' Exchanges - Forbes.  It’s hard to come up with new ways to describe the Obama administration’s improvisational approach to the Affordable Care Act’s troubled health insurance exchanges. But last night, the White House made its most consequential announcement yet. The administration will grant a “hardship exemption” from the law’s individual mandate, requiring the purchase of health insurance, to anyone who has had their prior coverage canceled and who “believes” that Obamacare’s offerings “are unaffordable.” These exemptions will substantially alter the architecture of the law’s insurance marketplaces. Insurers are at their wits’ end, trying to make sense of what to do next. ...
  • The Weekly Standard, Dec. 20: - At this point, after months of on-the-fly pronouncements, delays, and exemptions (often announced, not coincidentally, in the days just before a major national holiday), perhaps nothing should surprise us anymore about Obamacare’s disastrous rollout. But yesterday’s announcement is still startling because of what it says about the state of the president’s signature domestic legislation. The law is falling apart before our eyes. ...
  • Who Says Obama Hasn’t United the Country? National Review - Yesterday the Obama administration suddenly moved to allow hundreds of thousands of people who’ve lost their insurance due to Obamacare to sign up for bare-bone “catastrophic” plans. It’s at least the 14th unilateral change to Obamacare that’s been made without consulting Congress. ...
  • Douglas Holtz-Eakin: ... I am no fan of this administration, so I say this carefully and with forethought: this is a disgraceful move. It was done effectively on Friday before the holiday (a far-too-familiar tactic for followers of the Administration). Nobody — not the president, not Sebelius, not even a press flack — took responsibility and faced the American people. Instead, it was done via a letter and leaked blog post. And it is a mere 4 days before people were supposed to be obligated to be insured. Shameful. Period. ...

  • Megan McArdle at Bloomberg: ... The White House is focused on winning the news cycle, day by day, not the kind of detached technocratic policymaking that they, and the law’s other supporters, hoped this law would embody. Does your fix create problems later, cause costs to spiral or people to drop out of the insurance market, or lead to political pressure to expand the fixes in ways that critically undermine the law? Well, that’s preferable to sudden death right now. ...