WASHINGTON, DC – JUNE 28: U.S. President Barack Obama talks on the phone in the Oval Office, after learning of the Supreme Court’s ruling on the individual mandate of the ‘Patient Protection and Affordable Care Act’ on June 28, 2012 in Washington, D.C. (Image credit: Getty Images via @daylife)
Yesterday afternoon, chief executives of 12 major health insurers—including Aetna, Humana, WellPoint, and Kaiser Permanente—trudged to the White House to “discuss…ongoing implementation of the Affordable Care Act.” The meeting was off the record, but we have a pretty good idea of what happened. Insurers were likely to urge the White House to delay the implementation of Obamacare’s exchanges until the website, Healthcare.gov, gets fixed. And it appears they got their wish.Last night, the White House confirmed that it intends to delay the enforcement of the individual mandate by as much as six weeks.
“The White House is meeting with insurance industry executives,” a consultant to insurers told Ezra Klein, “and I can tell you what they’re talking about. [They’re saying] you need to get this fixed, because you’re setting us up for a real fall with our customers. [Patients are] not going to blame Kathleen Sebelius if they walk into their doctor’s office and the doctor doesn’t know who they are. They’ll blame the insurance company. And I’m sure what the insurers are telling the White House today is we will not let you put us in that position.”
So here’s what the White House did, according to Sarah Kliff of the Washington Post. Earlier, in response to an inquiry from tax-preparer Jackson Hewitt, the administration said that Americans needed to buy health insurance by February 15 in order to avoid the individual mandate’s fine against those who go without coverage. The “open enrollment” period in 2014, however, during which you can buy coverage and still gain access to Obamacare’s provisions regarding pre-existing conditions, ends on March 31.
So the White House decided that it would move the deadline for buying insurance back to March 31, even if that means people went without coverage through April, because it takes time for an “enrollment” to turn into actual coverage from an insurer. Some reporters are downplaying the importance of the delay. But it is a significant move by an administration that has aggressively defended the individual mandate against efforts by Republicans to delay it; the recent government shutdown was in part precipitated by this dispute.
It’s not clear what legal justification the White House is using for its unilateral delay of the individual mandate, but the Affordable Care Act contains many loopholes and exceptions that give the Department of Health and Human Services power to selectively enforce the law. Earlier this summer, the GOP-controlled House of Representatives passed a one-year delay of the mandate, but that bill died in the Democrat-controlled Senate.
Broussard: ‘The verdict’s out’ on healthy people signing up
I recently spoke to one of those CEOs, Bruce Broussard of Humana, at the Forbes Healthcare Summit. Broussard expressed optimism that the website would eventually get fixed. But he was more cautious about whether or not healthy and young people will pay lots more for health insurance in order to subsidize other people.
“The exchanges probably are a good thing,” says Broussard. “It’s expanding coverage for people, and we think that in the long run it will be the right thing to do. In the short run, it’s got some bumps, and the industry and the government expected that. But we are focused on fixing those bumps, and to work with the government to make it both a good experience [while] driving down health care costs and improving the quality.”
We know that sick people will sign up, because the law heavily subsidizes coverage for them. But will other people? “The verdict’s out on that, to be honest with you…the federal government and the states are trying to stimulate more and more people to sign up. I think as the penalty increases for not having insurance, probably you will see more people sign up. But in the short run, it could be [sicker] people that just need coverage.”