Would Obamacare Delays Make Any Difference?

Here’s a guide to understanding what’s going on with Obamacare, who wants to delay what — and whether any of it would have an impact.

US Sen. Jeanne Shaheen (C), D-NH, speaks during a press conference to highlight the impact of the government shutdown on small bussinesses on October 3, 2013 in the Mansfield Room of the US Capitol in Washington, DC.
National Journal
Sam Baker and Sophie Novack Clara Ritger
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Sam Baker and Sophie Novack Clara Ritger
Oct. 28, 2013, 5:02 p.m.

The vari­ous pro­pos­als to delay Obama­care are al­most as con­fus­ing as the law it­self.

Mem­bers of Con­gress are in a frenzy over the prob­lems plaguing Health­Care.gov. Re­pub­lic­ans are re­heat­ing their calls for delays as they try to cap­it­al­ize on the Health and Hu­man Ser­vices De­part­ment’s ter­rible pub­lic re­la­tions, and Demo­crats, seek­ing polit­ic­al dis­tance from the botched rol­lout, are float­ing their own set of delays.

Toss in a poorly un­der­stood an­nounce­ment from the White House last week and it’s easy to see why ana­lys­is of the way for­ward is of­ten con­fused. Here’s a guide to un­der­stand­ing what’s go­ing on, who wants to delay what — and wheth­er any of it would make a dif­fer­ence.

Op­tion 1: Delay the in­di­vidu­al man­date. The Af­ford­able Care Act re­quires most Amer­ic­an tax­pay­ers to either buy in­sur­ance or pay a tax pen­alty. Some law­makers — mostly Re­pub­lic­ans, but also Sen. Joe Manchin, D-W.Va. — have pro­posed delay­ing the man­date for a year. That means the re­quire­ment to buy in­sur­ance wouldn’t ap­ply for that peri­od, and the gov­ern­ment also wouldn’t col­lect pen­al­ties from people who re­main un­in­sured.

While law­makers have called for a one-year delay, a man­date delay could be as short as a month or two, or less.

A long delay of the in­di­vidu­al man­date, on its own, doesn’t make much sense as a way to make up for the slow start to en­roll­ment. The point of the man­date is to bring young, healthy people in­to the sys­tem to off­set the costs of guar­an­tee­ing cov­er­age to sick people.

Re­mov­ing the man­date in the first year would not it­self give con­sumers more time to buy in­sur­ance, and would ac­tu­ally make it easi­er for people, es­pe­cially young people, not to sign up for cov­er­age. That’s not what Demo­crats need to make Obama­care work.

“The only reas­on to delay the man­date is out of a sense of fair­ness,” said Aus­tin Frakt, a health care eco­nom­ist at Bo­ston Uni­versity. “It doesn’t help the mar­ket in any way.”

Frakt said the Obama ad­min­is­tra­tion could delay the man­date on its own, without con­gres­sion­al ap­prov­al, be­cause the law in­cludes an ex­emp­tion for any­one who has ex­per­i­enced a “hard­ship” ap­ply­ing for cov­er­age. The in­ab­il­ity to sign up on­line would prob­ably count.

Op­tion 2: Ex­tend the open-en­roll­ment peri­od. The Af­ford­able Care Act provides a six-month win­dow for people to sign up for cov­er­age in the first year. It began on Oct. 1 and ends on March 31. A defined en­roll­ment win­dow was in­cluded to pre­vent people from simply sign­ing up for in­sur­ance on their way to the doc­tor’s of­fice — or, worse, the emer­gency room.

(There are ex­cep­tions for people whose cir­cum­stances change at an­oth­er point in the year — for ex­ample, if they have a child they need to in­sure, if they get mar­ried, or if they be­come preg­nant.)

Sen. Jeanne Shaheen, D-N.H., and a hand­ful of oth­er Demo­crats are call­ing on the ad­min­is­tra­tion to ex­tend the en­roll­ment win­dow, al­low­ing con­sumers to buy in­sur­ance later than March 31. Some have sug­ges­ted a two-month ex­ten­sion, or one that simply lasts as long as Health­Care.gov con­tin­ues to have prob­lems.

“Ex­tend­ing this peri­od will give con­sumers crit­ic­al time in which to be­come fa­mil­i­ar with the web­site and choose a plan that is best for them,” Shaheen wrote in a re­cent let­ter to HHS Sec­ret­ary Kath­leen Se­beli­us. “In­di­vidu­als should not be pen­al­ized for lack of cov­er­age if they are un­able to pur­chase health in­sur­ance due to tech­nic­al prob­lems.”

Ex­tend­ing the en­roll­ment peri­od without delay­ing the man­date would mean con­sumers who missed the man­date dead­line could still en­roll, and would simply pay a pen­alty for each month they re­mained un­in­sured after Jan. 1.

Ex­tend­ing the open-en­roll­ment win­dow would re­quire con­gres­sion­al ap­prov­al, Frakt said.

Op­tion 3: Do both. As of now, the end of the en­roll­ment win­dow is March 31. The cutoff to avoid pay­ing the in­di­vidu­al man­date’s pen­alty will also be March 31, the White House has said. Most health policy ex­perts say that if the en­roll­ment win­dow is even­tu­ally ex­ten­ded, it only makes sense to push back both dead­lines to­geth­er.

Mis­matched dead­lines have already caused plenty of con­fu­sion. The cutoff for the in­di­vidu­al man­date was ini­tially set for Feb. 15 — mean­ing there was about a six-week peri­od in which people were al­lowed to buy in­sur­ance but could have been fined any­way.

That didn’t make a lot of sense, so the White House an­nounced that it would push the man­date cutoff to March 31.

Even that small change touched off re­ports of “delay­ing the in­di­vidu­al man­date,” though the ac­tu­al change was simply tech­nic­al. But we’ll prob­ably have to go through that all again if the White House de­cides to ex­tend the open-en­roll­ment peri­od.

Op­tion 4: Do noth­ing. If the ad­min­is­tra­tion can get Health­Care.gov on track by the end of Novem­ber, it might not need to worry about the op­tics of any delays.

“Un­less there is far more dis­aster than the ad­min­is­tra­tion is ad­mit­ting right now, it would be a really bad idea to delay, and cause more prob­lems for in­surers nervous already about what kind of risk pool they’re draw­ing from,” said Tim Jost, a Wash­ing­ton and Lee Uni­versity law pro­fess­or and a sup­port­er of the Af­ford­able Care Act. “On the oth­er hand, if no one can get through [the] site, I’m sure in­surers would prefer [to delay].”

Jost and Frakt said that if Health­Care.gov is func­tion­al by its new dead­line, people will still have plenty of time to sign up for in­sur­ance. Some might miss the Dec. 15 dead­line for a policy that takes ef­fect on Jan. 1, but will still have three full months to sign up. That should be enough time, they said.

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