Tag: health insurance exchanges

CBO: One-Year Delay of Employer Mandate Increases Spending, Debt, and Dependence

The Congressional Budget Office has released its cost estimate of the Obama administration’s one-year repeal delay of ObamaCare’s employer mandate and anti-fraud provisions. The CBO expects the Obama administration’s unilateral rewriting of federal law (my words, not CBO’s) will increase federal spending by $3 billion in 2014 and reduce federal revenues by a net $9 billion, thereby increasing the federal debt by $12 billion. If President Obama keeps this up, Congress may have to raise the debt ceiling or something.

Where is that $3 billion of new spending going? The CBO estimates the administration’s action will lead to about half a million additional people receiving government subsidies, including through ObamaCare’s Exchanges:

All told, as a result of the announced changes and new final rules, roughly 1 million fewer people are expected to be enrolled in employment-based coverage in 2014 than the number projected in CBO’s May 2013 baseline, primarily because of the one-year delay in penalties on employers. Of those who would otherwise have obtained employment-based coverage, roughly half will be uninsured and the others will obtain coverage through the exchanges or will enroll in Medicaid or the Children’s Health Insurance Program (CHIP), CBO and JCT estimate.

Which makes the president’s delay of the employer mandate and anti-fraud provisions consistent with his administration’s goal of hooking enough voters on government subsidies to affect electoral outcomes and votes in Congress.

An Obamacare Prediction

Based on the White House’s past lawlessness and corruption in the service of Obamacare, I’m willing to venture the following prediction:

The Obama administration will announce in August, probably in a classic Friday news dump, that (1) it will offer Exchange subsidies to workers enrolled in multiemployer union plans, and (2) it will pay the FEHBP contribution toward the Exchange premiums for members of Congress and their staffs.

Here’s what makes this prediction interesting: neither of those things would be legal. So, for the record, I really hope this prediction does not come true.

The last time I made a prediction was this one from December 2012:

HHS maintains they’ll have these [Exchange] things up and running by October 2013. I don’t know anyone who is confident about that and I’m ready to predict that they will not.

That prediction proved true when the Obama administration announced the eligibility verification system for Exchange subsidies would not be ready on time, and took the not-legal step of delaying enforcement of the eligibility rules for a year.

‘Stupid’ ObamaCare Provision Offends America’s Highest Caste: Congress

ObamaCare’s gravest sin may be that it has offended America’s highest caste: members of Congress and their staffs. Thanks to an amendment by Sen. Chuck Grassley (R-IA), the law provides:

the only health plans that the Federal Government may make available to Members of Congress and congressional staff with respect to their service as a Member of Congress or congressional staff shall be health plans that are created under this Act…or offered through an Exchange established under this Act…

In effect, ObamaCare throws members of Congress out of the Federal Employees Health Benefits Program (where most members and staff obtain health insurance) and offers them no other choice but to enroll in coverage through one of ObamaCare’s Exchanges. But here’s the kicker: though the federal government currently pays thousands of dollars of the cost of the congresscritters’ FEHBP coverage, neither ObamaCare nor any other federal law authorizes the feds to apply that money toward a congresscritter’s Exchange premiums. Today’s New York Times reports:

David M. Ermer, a lawyer who has represented insurers in the federal employee program for 30 years, said, “I do not think members of Congress and their staff can get funds for coverage in the exchanges under existing law.”

So ObamaCare essentially delivers a pay cut to members and staff in the neighborhood of $5,000 for single employees and $10,000 for families. 

Even congressional Democrats who voted for ObamaCare are freaking out (and pointing fingers). Again, the New York Times:

Representative Diana DeGette, Democrat of Colorado, said the Senate was responsible for the provision requiring lawmakers and many aides to get insurance in the exchanges.

“We had to take the Senate version of the health care bill,” Ms. DeGette said. “This is not anything we spent time talking about here in the House.”

Another House Democrat, speaking on condition of anonymity, said, “This was a stupid provision that never should have gotten into the law.”

You’d never know they had a choice, and voted for this provision anyway.

Finally, the Times notes, “The issue is politically charged because the White House and Congress are highly sensitive to any suggestion that lawmakers or their aides are getting special treatment under the health law” and, “Aides who work for Congressional committees and in leadership offices, like those of the speaker of the House and the majority and minority leaders of the two chambers, are apparently exempt — though neither Congress nor the administration has said for sure.” That creates the potential for a sneaky, backdoor way that ObamaCare supporters — say, the Senate Democrats who set budgets for congressional offices — could shield their staff from ObamaCare: shift staff from personal to committee and leadership offices.

Or, the White House could just decide to make the same contribution to their Exchange coverage, statute be damned. It wouldn’t be the first time this White House tried to protect ObamaCare by spending money that Congress never authorized.

Congressional watchdogs, be on the lookout. 

Obamacare: House Hearing on the IRS’s Illegal Taxing, Borrowing & Spending

As Jonathan Adler and I detail in our Health Matrix article, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA,” the Obama administration is attempting to rescue Obamacare from oblivion by literally taxing, borrowing, and spending more than $700 billion without congressional authorization. In a recent letter to the editor of the Washington Post, I explain how these illegal taxes are already hurting workers. 

On July 25, chairmen of the House Ways & Means Committee, the House Committee on Oversight & Government Reform, and two Oversight subcommittees sent a letter to Treasury Secretary Jacob Lew demanding information related to the illegal tax-credit rule.

The House Oversight Subcommittee on Health Care has announced it will hold a hearing this Wednesday, July 31, on the IRS’s illegal tax-credit rule titled, “Oversight of IRS’s Legal Basis for Expanding ObamaCare’s Taxes and Subsidies.” Adler will testify alongside Oklahoma Attorney General Scott Pruitt and Missouri physician and small business owners Charles Willey, each of whom has filed suit to block the IRS’s illegal rule. 

Kathleen Sebelius on Obamacare’s ‘Very Tight’ Deadliness

Yes, deadliness. That was the original headline for this exclusive Washington Post interview with the Empress of ObamaCare. It’s still in the URL. All parties now swear it was a typo. We report, you decide.

In that interview, Sebelius admits they’re not going about this whole ObamaCare implementation thing the best way:

Ideally what you would do if you were building a data hub that needs this kind of information, you’d put a piece together and test that. You test it, if you will, sequentially. We have to build and test simultaneously.

And:

We always knew that the federal government clearly cannot do this alone. We never anticipated that we would.

And still Sebelius admits she isn’t doing ObamaCare full-time.

Oregon Libertarians to Obamacare: Don’t Fence Me In

Ben Nanke, a 20-year-old aspiring songwriter and filmmaker from Salem” was none-too-pleased to see the glossy odes to Obamacare that will run in Oregon at a cost to taxpayers of some $9.9 million. Who can blame him? The videos claim Obamacare will make you healthier and live longer, even though there is zero reliable evidence that’s the case, and much evidence to suggest it won’t. Also, that had better be his own guitar that Matt Sheehy is getting wet.

 So the libertarian Nanke and his friends composed and cut a video for “Don’t Fence Me In,” their own love letter to Oregon, and freedom. Here’s what Nanke wrote at the video’s YouTube page:

As native Oregonians, we found it strange that a large-scale, federally-funded ad campaign is trying to twist the meaning of “the Oregon Spirit.”

Quoting the Oregonian - “Mark Ray, co-owner and creative director of North [who created the ad campaign], said the initial ads are to ‘create almost a hello’ sort of vibe, while stressing an ‘Oregon pride, Oregonians take care of themselves kind of thing.’”

We agree, and believe that “Oregonians take care of themselves” means exactly that. We take care of ourselves. No government mandates, no tax penalties, and no manufactured marketplaces. We love seeing our fellow Oregonians happy, healthy, and strong, which is why we don’t want to see our state fenced in by government-controlled health care.

A sampling of the lyrics, and the full video follow.

Long ago the wagons traveled past the cliffs of the Gorge

We watched the sagebrush trails become I-84

It’s not that I don’t care, it’s that I’ve seen it before

We say “oh, don’t fence me in.”

You say, “ooh, it looks mighty innocent”

but follow the trail, you know it’s gonna derail

I say “ooh, we’re all going to pay for this”

We’ve travelled quite a long road, and we know where this goes

You say it’s time for a change from the Oregon range

Rugged individuality gives way to rain and trees

So don’t tell the people of Oregon that we don’t care

Don’t fence me in. (Don’t fence me in)

Delay of ObamaCare’s Employer Mandate Shows How Nervous Feds Are about What Lies Ahead

Many have speculated that the Obama administration isn’t prepared to roll out ObamaCare. Some have speculated that even if the administration were prepared, the rollout would still be chaotic with job losses, rate shock, employer dumping, and the like. But since the Obama administration has been remarkably secretive about the status of its implementation efforts, no one has a better perspective on its preparedness, and the potential for chaos, than the administration itself. That’s why the decision to delay the implementation of ObamaCare’s employer mandate for one year is so illuminating.

Implementing the law without the employer mandate will definitely be very chaotic. (How can the federal government determine eligibility for the law’s subsidies if it doesn’t know whether workers received an offer of adequate coverage from an employer? Will the delay cause even more employers to drop coverage? Will it lead to some workers not receiving subsidies who otherwise would? Will employers’ and workers’ responses to the delay affect the risk profile of those who seek coverage through the exchanges? If so, how will that affect insurers, who have already filed their rates based on the assumption that the employer mandate would be in place? Will this delay lead to more delays, and ultimately to repeal? Will it increase political pressure for repeal of the individual mandate?) The whole purpose of the employer mandate was to reduce the economic and political upheaval that the rest of ObamaCare will unleash.

The decision to delay this mandate suggests that, from the Obama administration’s uniquely informed vantage point, the chaos that will result from its delay will be less than what would result from implementing it when the law requires. The administration doesn’t go around looking for ways to make implementation harder. This decision can only be understood as an effort to take the path of least resistance – and if this is the path of least resistance, then ObamaCare itself must be even more chaotic. This decision is the best window we have to see how nervous the administration is about what lies ahead.