Obama Administration to Delay Individual Mandate for Some

Those with canceled policies will be exempt from Obamacare’s penalty for not buying insurance.

Health and Human Services Secretary Kathleen Sebelius (L) leaves after the House Energy and Commerce Committee hearing about the troubled launch of the Healthcare.gov website October 30, 2013.
National Journal
Clara Ritger
Add to Briefcase
Clara Ritger
Dec. 19, 2013, 3:47 p.m.

The Obama ad­min­is­tra­tion will not re­quire the mil­lions of Amer­ic­ans who re­ceived health-in­sur­ance plan can­cel­la­tion no­tices to pur­chase a new policy next year.

They’re grant­ing those con­sumers an ex­emp­tion from the Af­ford­able Care Act’s in­di­vidu­al man­date, a De­part­ment of Heath and Hu­man Ser­vices spokes­wo­man con­firmed. The man­date re­quires every­one to have health in­sur­ance or face a tax pen­alty, the great­er of $95 or 1 per­cent of in­come in 2014.

The ad­min­is­tra­tion will also al­low those con­sumers to sign up for cata­stroph­ic cov­er­age. Those bare-bones plans are avail­able to people who are un­der 30 or qual­i­fy for a “hard­ship ex­emp­tion.”

HHS Sec­ret­ary Kath­leen Se­beli­us said in a let­ter to Sen. Mark Warner, D-Va., that the ad­min­is­tra­tion is grant­ing a “hard­ship ex­emp­tion” to Amer­ic­ans whose plans were can­celed and “might be hav­ing dif­fi­culty” pay­ing for stand­ard cov­er­age.

The al­low­ance comes after months of polit­ic­al fal­lout from the pres­id­ent’s prom­ise that “if you like your plan, you can keep your plan,” which proved un­true this fall after mil­lions of people re­ceived no­tices from in­sur­ance com­pan­ies in­form­ing them that their cur­rent policies did not meet cov­er­age re­quire­ments un­der the new law and there­fore would not be offered next year.

Prob­lems plaguing sign-ups on the fed­er­al-ex­change web­site Health­Care.gov ad­ded to the pres­sure. With the dead­line to sign up for cov­er­age be­gin­ning Jan. 1, just days away, the move could help the law’s fa­vor­ab­il­ity rat­ing among con­sumers — and save the skin of con­gres­sion­al Demo­crats fa­cing chal­lengers in next year’s midterm elec­tions.

Earli­er this fall, a group of Demo­crat­ic sen­at­ors sent the ad­min­is­tra­tion a let­ter ask­ing for cla­ri­fic­a­tion on the “hard­ship ex­emp­tion.”

Warner — along­side Demo­crat­ic Sens. Jeanne Shaheen (N.H.), Mary Landrieu (La.), Heidi Heitkamp (N.D.), and Tim Kaine (Va.), and In­de­pend­ent An­gus King (Maine) — said that in­di­vidu­als who re­ceived plan-can­cel­la­tion no­tices and con­sidered their new premi­ums un­af­ford­able should qual­i­fy for the ex­emp­tion and be able to pur­chase a cata­stroph­ic plan. Landrieu and Shaheen are both fa­cing reelec­tion bids next year.

The White House es­tim­ates the al­low­ance will af­fect roughly 500,000 people, whom it has de­term­ined re­ceived can­cel­la­tion no­tices but have not yet pur­chased a new plan. The num­ber was re­leased late Thursday after of­fi­cials com­piled data from states and in­sur­ance com­pan­ies.

But the deal for con­sumers is yet an­oth­er bur­den for in­surers, who earli­er this week went along with the White House’s re­quest to grant le­ni­ency to con­sumers pay­ing premi­ums in Janu­ary. Con­sumers will now be al­lowed to send pay­ments un­til Jan. 10 and re­ceive cov­er­age ret­ro­act­ively to Jan. 1.

This change could have a more long-term im­pact. Cata­stroph­ic-cov­er­age plans were priced with a 30-and-un­der con­sumer base in mind. And with thou­sands who were barred from the mar­ket due to preex­ist­ing con­di­tions ex­pec­ted to pur­chase the new cov­er­age, al­low­ing people who already had cov­er­age to go without it could up­set the bal­ance of the risk pool. The Af­ford­able Care Act ex­changes need enough healthy people to bal­ance out the costs of care for the sick or premi­ums could rise in 2015, cre­at­ing a “death spir­al” and jeop­ard­iz­ing the law’s suc­cess al­to­geth­er.

Con­sumers have un­til 11:59 p.m. EST on Dec. 23 to sign up for cov­er­age that be­gins Jan. 1.

Read the full let­ter from HHS Sec­ret­ary Kath­leen Se­beli­us here.

Read the full let­ter from the co­ali­tion of sen­at­ors here.

What We're Following See More »
THEM’S FIGHTIN’ WORDS
Earnest: Overriding Obama’s Veto Was “Embarrassing”
39 minutes ago
THE LATEST

Hyperbole alert! Following the Senate's decision to override President Obama's veto of a bill that would allow 9/11 victims to sue Saudi Arabia in U.S. court, the White House has responded forcefully, specifically White House Press Secretary Josh Earnest. "I would venture to say that this is the single most embarrassing thing that the United States Senate has done, possibly, since 1983," Earnest said on Air Force One. The House is likely to follow suit in overriding Obama's veto when it takes up the vote.

Source:
FIRST TIME IN OBAMA’S PRESIDENCY
Senate Overrides Obama’s Veto
2 hours ago
THE LATEST
TRIBUTES FROM AROUND THE WORLD
Former Israeli President & PM Shimon Peres Dies at 93
5 hours ago
THE DETAILS

Two weeks after a massive stroke, Nobel Peace Prize winner and former president and prime minister of Israel Shimon Peres passed away late Tuesday night. In a political, military, and diplomatic career that lasted nearly 70 years, Peres was influential both in building up the formidable strength of the Israeli military and in seeking to negotiate lasting peace with Israel's many neighboring Arab countries. Within hours of the announcement of his death, both condolences and tributes began pouring in, including from former President Bill Clinton, Speaker of the House Paul Ryan, and former United Kingdom Prime Minister Tony Blair.

AFRAID HE’S TAKING SUPPORT FROM CLINTON
Democrats Taking Aim at Gary Johnson
5 hours ago
WHY WE CARE

"Democrats panicked by third-party candidates drawing support away from Hillary Clinton are ramping up their attacks against Gary Johnson and warning that a vote for a third party is a vote for Donald Trump. Liberal groups are passing around embarrassing videos of Johnson and running ads against him warning about his positions on issues like climate change that are important to young voters and independents."

Source:
RUSSIA DENIES
Dutch Investigators: MH17 Was Downed by Russian Launcher
5 hours ago
THE LATEST

Russo-Western relations are getting thornier all the time. "Dutch-led criminal investigators said Wednesday they have solid evidence that a Malaysian jet was shot down by a Buk missile moved into eastern Ukraine from Russia. Wilbert Paulissen, head of the Central Crime Investigation department of the Dutch National Police, said communications intercepts showed that pro-Moscow rebels had called for deployment of the mobile surface-to-air weapon, and reported its arrival in rebel-controlled areas of eastern Ukraine." Russia, of course, is denying culpability.

Source:
×