Obamacare Delayed By One Year: What Does It Mean? 6 Questions And Answers
Confused by last night's bombshell white flag of defeat by the Obama administration which delayed the implementation of the employer mandate, aka the "shared-responsibility rules" by one year until 2015 derailing the public education campaign that the rollout of Obamacare was set to take place in October? Then the following list of 6 questions and answers from Politico analyzing the ins and out of the decision is for you.
From Politico: 6 questions about the Obamacare mandate
Does this derail Obamacare?
It doesn’t derail it. But it hurts, at least in how the public sees it and how the critics can talk about it.
Polls have already shown that Americans still don’t know much and have a lot of misperceptions about the 3-year-old law. This won’t help, particularly with the critics emboldened to talk about chaotic implementation of a fatally flawed policy.
The administration insists that the new health insurance exchanges or marketplaces will start enrollment on time this Oct. 1. A lot more people will get covered in those new markets than through the employer mandate, which wasn’t as central to the coverage push because most big businesses already offer health benefits. But it could mean that fewer people do get coverage next year.
The announcement gave fresh ammunition to GOP opponents.
Republicans used it to again say that the law should be repealed and replaced. Repeal won’t happen as long as President Barack Obama’s in the White House, but some groups on Tuesday renewed their calls for defunding the health law – a throwback to congressional fights in the previous Congress. Even before this announcement, some in the GOP had been pushing for another funding fight, maybe tied into the coming battles over the debt ceiling. And of course it will resonate in the 2014 House and Senate campaigns.
“Pushing the implementation of the employer mandate until after the 2014 election confirms the law was a historic mistake,” said Sen. Lamar Alexander of Tennessee, the top Republican on the Senate Health, Education, Labor and Health Committee.
Will more health law dominos fall?
One immediate question people were asking: Is this the only delay the Obama administration will be announcing? Or is it the first in a line of dominos — with the individual mandate being the most important domino. After all, the administration has already delayed until 2015 a key feature in the small-business exchanges that would have given workers more choice in health plans.
And the individual mandate is a prime target for opponents who can say, why should big companies get out of confounding Obamacare rules if an average citizen cannot?
The White House put up a blog post stressing that the main elements of the law will be ready to go in October. And allies said the move Tuesday put a piece of the law — but not the core of it — on hold.
Asked whether the individual mandate could be pushed back, Ron Pollack, head of the Families USA advocacy group said, “I believe that is inconceivable.” The employer mandate is a segment of the law, but the individual mandate is its core.
And don’t expect the individual mandate, which survived a Supreme Court challenge last year, to go down easily. For starters, insurance companies would pitch a fit. They need the individual mandate if they are going to provide costly new services to cover everyone, sick and healthy, as the law requires.
Why did Treasury have to do this?
Businesses with more than 50 workers were supposed to provide health insurance starting in 2014 or face a penalty of $2,000 per employee. That’s been put on hold after a noisy outcry from business groups and a lot of commentary about how the law was hurting business as the economic recovery was still fragile.
Business groups said the rules and regulations about employee coverage — who was full time, what kind of benefits they were getting, what requirements were being fulfilled — were cumbersome. So on Tuesday the Treasury, which is responsible for this piece of Obamacare, said it had agreed to go back to the drawing board.
Later this summer, “after a dialogue with stakeholders,” Treasury will try to come up with a streamlined set of regs,”consistent with effective implementation of the law,” an official wrote in a blog post announcing the decision.
Who will be hurt by the delay?
Conservative health analysts predicted employers would drop coverage and dump employees into the taxpayer-subsidized exchanges.
“Essentially for calendar 2014 the act of dropping coverage and dumping employees into the exchanges is on sale,” said Douglas Holtz-Eakin, president of the American Action Forum and a former head of the Congressional Budget Office.
More liberal health experts predicted that big business would stick to the status quo. The CBO in the past has said the employer mandate wouldn’t add a lot of newly covered people.
Even though critics of the health law often complain that it’s killing small businesses, any business with 50 or fewer workers is exempt from the coverage rules. They can cover workers — but don’t have to. Those that do may get subsidies, and that’s not changing under the policies announced Tuesday.
Big businesses tend to cover workers already. In 2012, 98 percent of companies with more than 200 employees provided health benefits to their workforce, according to an annual Kaiser Family Foundation survey.
It’s the midsized companies that may have the biggest impact from this delayed policy. But even here, 94 percent of firms with 50 to 199 workers offer coverage, although not necessarily to everyone.
“At the margins, some firms that might have otherwise offered insurance may wait to see how things play out,” said Paul Van de Water, a health policy expert at the Center on Budget workers, especially in the restaurant and retail industries, are likely to see their hours cut by businesses trying to avoid paying the penalties, Brian Haile, senior vice president for health policy at Jackson Hewitt Tax Service, wrote in an email.
And if people do lose coverage on the job — or don’t get coverage at work that they anticipated in 2014 — they can get insurance in the exhanges, possibly qualifying for tax credits depending on their income.
Who’s pleased about the mandate delay?
Businesses who don’t have to worry about the rules for another year and Republicans who got more chances to say that Obamacare isn’t ready for prime time — and may never be.
“This announcement means even the Obama administration knows the ‘train wreck’ will only get worse,” House Speaker John Boehner said. “This is a clear acknowledgment that the law is unworkable, and it underscores the need to repeal the law and replace it with effective, patient-centered reforms.”
Democrats were largely silent, but a few did depict the delay as a sign that the law is being implemented responsibly.
“Flexibility is a good thing,” said Adam Jentleson, a spokesman for Senate Majority Leader Harry Reid. “Both the administration and Senate Democrats have shown — and continue to show — a willingness to be flexible and work with all interested parties to make sure that implementation of the Affordable Care Act is as beneficial as possible to all involved. It is better to do this right than fast.”
Is there a silver lining for the White House?
Maybe a few small ones. It should quell some of the outcry from the business community about the paperwork burden, and it may stop some of the drumbeat of businesses cutting their workers’ hours to avoid having to cover anyone who works 30 hours or more. But if that bad news subsides, the pattern of Obamacare is there’s always another critical storyline to replace it.
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