Wall Street Journal: At the Obamacare Improv


Today’s review and outlook in the Wall Street Journal examines how the Obama Administration implementation of the President’s signature legislation is a “making-it- up” as they go process . While the Administration claims the recent mandate delay for “medium- sized”  businesses is an effort to provide economic relief; in reality, it is a move to force more people onto the Obamacare exchanges.

President Obama predicted at the House Democratic retreat on Friday that “10 years from now, five years from now” people will look back on the Affordable Care Act as “a monumental achievement.” He’s right in the limited sense that, given the delays he has sanctioned so far, it will take years before anyone can tell if it works.

Now that we’ve had more time to parse this week’s announcement of a second delay of the employer mandate, the political reason for the carve-out is becoming clearer. Far from the economic relief that the White House claimed, the rule is meant to turn back the lifeboats toward the capsized ObamaCare ocean liner so the women and especially the children can help with the rescue.

The statutory mandate requires businesses with the equivalent of 50 full-time employees based on a 30-hour work week to cover all workers or else pay a fine, starting Jan. 1, 2014. Mr. Obama is pushing the deadline back to 2016 for a new business category the White House waved into existence—those with fewer than 100 workers. Plus, all employers above that threshold will have to cover a mere 70% of their work force that year, not the law’s pre-rewrite 100%.

If Mr. Obama really wanted to help alleviate labor market uncertainty, then he’d ask Congress to repeal the mandate permanently. No business is going to take the long-term risk of hiring and staffing decisions based on a temporary mandate holiday declared through unilateral administrative discretion.

And had Mr. Obama wanted to avoid a mass wave of small-business insurance cancellations ahead of the elections like the wave we saw last fall among individuals, then he would have relaxed the mandates for the costly gold-plated “essential benefits” that all plans will have to cover. That would have reduced the cost of small-business coverage. Instead it seems the President merely wants the political alibi of claiming to exempt some businesses so he can shift the blame to the insurers when the cancellations begin.

These two roads-not-taken suggest the real goal of the mandate delays is to funnel as many more people as possible into the new ObamaCare insurance exchanges. The President’s delays create less job-based coverage and therefore more Americans who must join ObamaCare if they want insurance. The ObamaCare exchanges are unlikely to survive financially unless enough healthy, low-cost young people buy overpriced policies to subsidize everybody else.

This week the Administration released new ObamaCare enrollment numbers, and they suggest that not enough young adults are signing up. For September 2013 through January, only about 25% of the 3.3 million sign-ups so far are ages 18 to 34. That share needs to rise to about 40% to make the actuarial math work.

Insurance companies also think that only between three of four or four of five of the “enrollments” so far are real. The balance are probably bureaucratic errors like one person who is double counted for two plans, or people who enrolled but then dropped out when it came time to pay the premiums.

Thus this week’s new delays. The employer mandate is designed to interlock with the rest of the system, and people are supposed to be eligible for subsidies only if their employers don’t offer insurance. Since the White House is releasing many more businesses from the mandate’s obligations, many more people will suddenly qualify to join the exchanges. The same goes for the 30% of workers who will be shut out from employer coverage under the new 70% mandate.

None of this ad libbing is consistent with the plain statutory text of the Affordable Care Act. But then the entire history of ObamaCare has been an exercise in liberals doing whatever it takes—pass it on a partisan vote and despite public disapproval, then rewrite it as they see fit to prevent its increasingly demonstrable flaws from killing it. Liberals know that’s the only way ObamaCare will be around a year from now, never mind five or 10.

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