Tag Archives: individual mandate

Obamacare Backers Quietly Destroying Their Own Creation

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DR FRANKENSTEIN AND HIS MONSTER

Op-ed by Kenton Henry

The analogy is irresistible and the comparison inescapable. Dr. Frankenstein  experienced an epic epiphany when he realized his good intentions had gone awry and he was responsible for creating a monster which was a threat to the public’s health and welfare.  And now the same realization has dawned on  the White House and Democratic Senate. They ignored all the polls which have always indicated the majority of Americans are not in favor of Obamacare. They ignored the entreaties of the Republicans (not one of whom voted for the Act) to at first repeal; then later, to post-pone the individual mandate. Now, with November’s mid-term elections on the horizon, they are pressing the panic button and back-pedaling in an overtly political attempt to mitigate fallout at the polls. Last week they modified the individual mandate allowing those who like their non-compliant plan to keep their plan through 2016. But what went unnoticed and unreported by the media was their latest move (also last week) to destroy their own creation wherein they modified the hardship exemption. It now allows anyone whose health plan was canceled due to Obamacare to sign a form stating such–and that the act of purchasing ACA compliant coverage would be “hardship”– to opt out of a purchase with no financial repercussions.  The details of the exemption are outlined in our feature article in The Wall Street Journal which concludes the exemption is essentially available to anyone who wants one.

 

In reality, the Democrats are realizing they are falling on their own sword. What was already a case of adverse selection in terms of the risk funneled into the new Affordable Care Act (ACA) compliant  policies, has now been made a case of adverse selection on steroids. This editor’s concern is that the insurance companies will not be able to sustain the new block of compliant policies and will fail minus another massive government bailout. Like banks, they will be deemed “too big to fail” by the administration. For now. Of course, in good time (after Democrats succeed in maintaining control of things), the safety net will be removed and the liberals will rejoice as the companies fail. And left leaning Democrats will have the single-payer system they have long admitted was their prize objective. An accomplishment so necessary for them to control one sixth of our nation’s economy. This in spite of the fact that every major social welfare program this country has implemented is on the fast track to insolvency.

 

As Dr. Frankenstein worked to destroy his own signature creation, the President now works to gut his. And as always . . . for the sake of politics.

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FEATURE ARTICLE:

The Wall Street Journal

ObamaCare’s Secret Mandate Exemption

HHS quietly repeals the individual purchase rule for two more years.

Updated March 12, 2014 6:58 p.m. ET
 

ObamaCare’s implementers continue to roam the battlefield and shoot their own wounded, and the latest casualty is the core of the Affordable Care Act—the individual mandate. To wit, last week the Administration quietly excused millions of people from the requirement to purchase health insurance or else pay a tax penalty. 

This latest political reconstruction has received zero media notice, and the Health and Human Services Department didn’t think the details were worth discussing in a conference call, press materials or fact sheet. Instead, the mandate suspension was buried in an unrelated rule that was meant to preserve some health plans that don’t comply with ObamaCare benefit and redistribution mandates. Our sources only noticed the change this week.

That seven-page technical bulletin includes a paragraph and footnote that casually mention that a rule in a separate December 2013 bulletin would be extended for two more years, until 2016. Lo and behold, it turns out this second rule, which was supposed to last for only a year, allows Americans whose coverage was cancelled to opt out of the mandate altogether.

In 2013, HHS decided that ObamaCare’s wave of policy terminations qualified as a “hardship” that entitled people to a special type of coverage designed for people under age 30 or a mandate exemption. HHS originally defined and reserved hardship exemptions for the truly down and out such as battered women, the evicted and bankrupts.

But amid the post-rollout political backlash, last week the agency created a new category: Now all you need to do is fill out a form attesting that your plan was cancelled and that you “believe that the plan options available in the [ObamaCare] Marketplace in your area are more expensive than your cancelled health insurance policy” or “you consider other available policies unaffordable.”

This lax standard—no formula or hard test beyond a person’s belief—at least ostensibly requires proof such as an insurer termination notice. But people can also qualify for hardships for the unspecified nonreason that “you experienced another hardship in obtaining health insurance,” which only requires “documentation if possible.” And yet another waiver is available to those who say they are merely unable to afford coverage, regardless of their prior insurance. In a word, these shifting legal benchmarks offer an exemption to everyone who conceivably wants one.

Keep in mind that the White House argued at the Supreme Court that the individual mandate to buy insurance was indispensable to the law’s success, and President Obama continues to say he’d veto the bipartisan bills that would delay or repeal it. So why are ObamaCare liberals silently gutting their own creation now?

The answers are the implementation fiasco and politics. HHS revealed Tuesday that only 940,000 people signed up for an ObamaCare plan in February, bringing the total to about 4.2 million, well below the original 5.7 million projection. The predicted “surge” of young beneficiaries isn’t materializing even as the end-of-March deadline approaches, and enrollment decelerated in February.

Meanwhile, a McKinsey & Company survey reports that a mere 27% of people joining the exchanges were previously uninsured through February. The survey also found that about half of people who shopped for a plan but did not enroll said premiums were too expensive, even though 80% of this group qualify for subsidies. Some substantial share of the people ObamaCare is supposed to help say it is a bad financial value. You might even call it a hardship.

HHS is also trying to pre-empt the inevitable political blowback from the nasty 2015 tax surprise of fining the uninsured for being uninsured, which could help reopen ObamaCare if voters elect a Republican Senate this November. Keeping its mandate waiver secret for now is an attempt get past November and in the meantime sign up as many people as possible for government-subsidized health care. Our sources in the insurance industry are worried the regulatory loophole sets a mandate non-enforcement precedent, and they’re probably right. The longer it is not enforced, the less likely any President will enforce it.

The larger point is that there have been so many unilateral executive waivers and delays that ObamaCare must be unrecognizable to its drafters, to the extent they ever knew what the law contained.

http://allplanhealthinsurance.com

http://thewoodlandstxhealthinsurance.com

House to Vote on Affordable Care Act Individual and Employer Mandates

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07.17.2013

Currently we have over 800,000 veterans awaiting decisions on their disability claims. The back log is so great–according to the most recent numbers available–the average wait time for a veteran is 15 months in Chicago, 16 months in New York and a year and a half in Los Angeles. Social Security’s disability program, which helps support 11 million Americans, will run through its trust fund in 2016, two years earlier than predicted. Couple this with the prediction Social Security, the fund that finances benefits for 44 million senior citizens and their survivors, will be exhausted by 2035 and Medicare, the health care program for those age 65 and over, will be have depleted its funds by 2024. Now consider a law has been passed which mandates health coverage for every American. Its objectives are largely, and initially, funded via subsidies from the federal government (you the tax payer). Can you possibly believe this is feasible given their track record? Given a federal debt of almost 17 trillion dollars? How long do you believe it will take before all private insurance companies are forced to withdraw from participation to be replaced by a single payer federally administrated program which can’t possibly be any more financially feasible than our government’s disability program, Social Security or Medicare?

Admin. – Kenton Henry

http://allplanhealthinsurance.com

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Today’s Feature Articles:

Legislation and Policy

House Votes To Target ACA Individual, Employer Mandates.

Coverage of the Obama Administration’s decision to delay the Affordable Care Act’s employer mandate continues Wednesday, the same day the House is set to vote to further capitalize on the weak position they believe the move has put Democrats in. Most reports, some national in scope, focus on the House votes to delay both the employer and individual mandates, while others focus on the implications of both of these provisions.

McClatchy                          (7/17, Kumar) reports that on Wednesday, the Republican-ruled House is expected to vote to delay key parts of the Affordable Care Act, a move that “is the latest in a sweeping legislative and political campaign to weaken the 2010 law and raise even more opposition in the eyes of an already skeptical nation, especially as it heads into 2014 elections that will decide control of the Congress and set the stage for the 2016 campaign for the White House.” The back-to-back votes will determine “whether to delay insurance mandates for both employers and individuals.”

The Washington Times

(7/16, Howell) reports that “President Obama has threatened to veto” the bills. Meanwhile, “the votes will force Democrats to align with the president or distance themselves from the overhaul in the wake of its recent stumbles.” In addition, it has put the “Office of Management and Budget in the awkward position of threatening, in the case of the employer mandate, to kill a bill that would reflect the White House’s own decision-making.”

CNN

(7/16, Walsh) reports that “most House Democrats are expected to oppose two House Republican bills on Wednesday that would delay key provisions of Obamacare,” according to House Democratic Whip Steny Hoyer (D-MD).

The Hill

(7/17, Baker) “Healthwatch” blog reports that the bill to delay the individual mandate “would cut the deficit, but would cause insurance premiums to rise,” according to the Congressional Budget Office.

Implications Of Employer Mandate Delay Still Unclear. The AP

(7/17, Alonso-Zaldivar) reports on the “domino effect” that is currently “undercutting” the Affordable Care Act: the Obama Administration’s delaying of the law’s employer mandate could “weaken” the individual mandate, because the requirement that companies report health insurance details for employers has also been pushed back. As the article explains, “without employers validating who’s covered, a scofflaw could lie, and the government would have no easy way to check.” The piece calls this yet “another incentive for uninsured people to ignore a new government requirement that for many will cost hundreds of dollars.”

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Not All Insurers Game for State Exchanges: The Consumer Impact

By Kate Rogers

Published July 11, 2013

FOXBusiness

As more insurers decide to pack up and leave certain states as health exchanges start to take form, experts say consumers are going to be left  feeling the pain.

Over the last few weeks, several departure announcements have sent a ripple through the health insurance industry, as companies weigh whether or not they want to play ball under Obamacare. So far, California has experienced the biggest migration  with Aetna (AET), UnitedHealthcare (UNH) and Cigna (CI) leaving the state’s exchange, Covered California.

Aetna also reportedly sent out a note to select customers last week, warning that the Patient Protection and Affordable Care Act is “changing health insurance.” Recipients were customers across the country with non-grandfathered health plans, meaning their plan was not in effect on March 23, 2010 and wouldn’t carry over under new state and federal exchange regulations under ACA.

“This includes adding preventative care and essential health benefits. The ACA also ends medical underwriting. Due to these and other changes, many people will pay more for their health insurance coverage in 2014 than they do today,” the letter stated according to the carrier.

Wellmark Blue Cross/Blue Shield also decided not to list on the individual exchange in Iowa for 2014, due to a lack of information available in the state, according to a spokesperson for the Iowa Insurance Division.

Fifteen states and the District of Colombia are in the process of creating their insurance exchanges before the 2014 deadline; when individuals must purchase insurance or face a fine for failing for comply with the individual mandate. The employer mandate has been pushed back to 2015, and some in the GOP including House Majority Leader Eric Cantor, (R-VA), are calling for the individual mandate to be rolled back as well.

More or Less Competition for Consumers?

Some experts say the recent departures hint consumers will have limited health-insurance choices thanks to the regulatory burdens of the law. Basic supply and demand dictates that with fewer insurers to choose from, consumers will have limited options and potentially higher prices, says Michael Cannon, director of Health Policy Studies at the CATO Institute.

A similar “exodus” occurred within the first six months of the implementation of the Affordable Care Act, Cannon says, when child-only care was enacted. Seventeen major insurers dropped child-only coverage, in an attempt to skirt the law’s new regulations and increased costs. The same may begin to take shape in the individual market.

“The program says you can’t charge higher premiums to the sick, so you have a situation where only low-risk consumers would be charged a premium much higher than their regular costs, so only people who buy it would be those who really needed it,” he says.

The employer mandate rollback is also a factor in the situation, says Grace-Marie Turner, founder of the Galen Institute, a health and tax policy research organization, as employers will now be incentivized to drop coverage and push their employees into the exchanges until 2015.

“It’s using employers to push more people into the exchanges,” Turner says.

Fewer insurers in state exchanges mean less competition, bottom line, she adds. “The whole point is we want more players, and more competition.”

Why California Matters

What happens in California is a big deal for the future of the Affordable Care Act, says Taylor Burke, associate professor and program director, MPH in Health Policy, at George Washington University.

“It’s an exit out the individual market, but [the insurers] only represent 8% of the individual market companies in the state,” Burke says. “California has the 7th largest economy on the globe, so whatever happens in California is a big deal for the stand up of the state exchanges.”

He points to two main reasons insurers leave a state: they don’t like the price points being offered in the exchanges nor the coverage they would have to offer under Obamacare’s 10 essential health benefits.

“In California, you can make the argument that there would be less choice, but if they stay in the market, their prices would be off the charts,” he says. “It would be a thing on the shelf, a high-ticket item that you couldn’t afford anyway.”

And if insurers take too long to make the decision, that may impact them negatively as well, he says.

“No one will want to buy their product. There’s a lot of hemming and hawing, but if the price point is too high, no one will buy it.”

But can consumers blame the insurer for higher prices? Turner says no, it’s the nature of the law’s regulations.

“Insurers can’t help the demands on the benefits they will have to cover—it will absolutely be more expensive,” she says. “It’s like going to buy a car with every accessory in the books—heated seats, fancy wheels, satellite radio, and saying you can’t charge more for it.”

What Insurers are Deciding

Robert Zirkenbach, spokesman for America’s Health Insurance Plans (AHIP), says each individual company will have to make their own decisions about which states to participate in as exchange bids come in.

“It will be based on a variety of reasons, but plans are offering coverage on the exchange, some will be outside the exchange—there will be options for consumers,” Zirkenbach says. “It will depend on the state and regulatory environment.”

He says the AHIP wants competition among insurers to keep consumer prices in check.  “Choice and competition is a good thing—when states have been setting up their exchanges, we are trying to encourage this,” he says.

The National Association of Insurance Commissioners says insurers who are leaving these markets are likely doing so because they have core businesses in other segments, including the large group market.

“The carriers we have seen exiting the individual market are not major players in that market segment, and therefore we don’t anticipate a major disruption of coverage for a large portion of the market,” a spokesperson said in an email statement. “Each insurance company is making decisions regarding its participation in exchanges based upon a number of factors.  Some are opting to participate in the exchanges, while others are not; however, nearly all of the requirements that apply to policies sold on the exchange also apply to policies sold outside the exchange, so insurers will not be avoiding a lot of requirements by opting out of the exchanges.”