Tag Archives: Exemption

News

Does the last-minute Obamacare exemption fix anything?

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One of my favorite writers on health care policy is Michael F. Cannon of the libertarian Cato Institute. He has an article in Forbes magazine that I think is a good level-set for the Obamacare changes that are happening in 2014 and beyond.

He writes:

[…]President Obama announced, just days before the deadline for purchasing coverage with a January 1 effective date, that he would offer a categorical “hardship exemption” from the individual mandate to anyone who had their insurance cancelled due to ObamaCare.

[…]If these folks choose not to buy health insurance, they will not face a penalty. They will also have the option to buy, “if it is available in your area,” the lower-cost catastrophic coverage that ObamaCare otherwise offers only to people under age 30, or who receive the separate “unaffordability” exemption from the mandate.

The obvious purpose of this policy is to give political cover to Senate Democrats who must face the voters next year, and are no doubt afraid of attack ads like this one.

[…]Yet this exemption may not be of much value to those who qualify, and is likely to create more problems for ObamaCare supporters than it solves.

The people who qualify for this exemption don’t actually want it. They want health insurance. They had affordable coverage, until ObamaCare took it away from them, and that’s what they still want now. Sebelius boasts that ObamaCare’s catastrophic plans cost 20 percent less than other ObamaCare plans, but don’t confuse that with affordable coverage. The Manhattan Institute’s Avik Roy — who is now the opinion editor for the sprawling Forbes empire – notes that ObamaCare’s catastrophic plans can still cost twice as much as what was previously available on the individual market.

But even if they like their catastrophic plan, they can’t keep it. Sebelius has complete control over the duration of the exemptions, which she has described as a “temporary” step “to smooth [consumers’] transition” to enrollment in Exchange plans. So in a matter of months, Obama will violate his “if you like your health plan” pledge again by kicking these folks out of their catastrophic plans. They will get another cancellation letter tossing them into the Exchanges. Their premiums will surge again. They may lose their doctor again.

The exemption means insurers will suffer losses this year, and rates will be higher next year, for all ObamaCare plans.

The president argued before the Supreme Court that ObamaCare’s regulatory scheme cannot work with out the individual mandate. Yet he has now exempted millions of the very people he most needs to comply with it. This exemption siphons good risks out of the Exchanges and destabilizes the risk pools for both the standard ObamaCare plans and the catastrophic plans. Participating carriers set the rates for their Exchange plans with the expectation that these folks would be purchasing bronze, silver, gold, and platinum plans through the Exchanges. But the healthiest members of this now-exempt group are the most likely to go uninsured or purchase a catastrophic plan. So Obama’s blanket exemption makes those risk pools older and sicker.

This blanket exemption also destabilizes the risk pools for the catastrophic plans. It opens those pools to lots of people over age 30, who have higher health expenses than people under age 30, and whom the insurers were not expecting to buy catastrophic plans when they set those rates.

So the effect of this is going to be to raise rates temporarily, because the insurers companies are not getting the younger, healthy people they need to make the rates as low as they originally calculated. They are going to lose a ton of money because the Democrats are changing the rules at the last minute. They people who have coverage are going to be the ones who make all the claims, and the people who normally don’t make claims are now exempt, temporarily – until the 2014 elections. This is going to be a huge hit to the health insurance companies.

As I noted before, the Democrats are going to have to bail out the insurance companies in order to account for the losses. It’s actually in the Obamacare law already, as David Freddoso explained. But will the Democrats use money from their political party to pay for their mistakes? Hell no – they will borrow it from your children, which is what they are so good at doing. There is a cost for electing incompetent people, and it’s going to continue to rise until the fools are voted out.

News

Democrats refuse another offer from Republicans to avoid government shutdown

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As expected, the Senate Democrats rejected the compromise on Tuesday.

Last Night, Senate Democrats Voted Along Party Lines To Shut Down The Government Rather Than Agree To Delay Obamacare’s Individual Mandate And Surrender Their Special Insurance Subsidies. “In an extraordinary back-and-forth between the House and Senate that extended late into the night, Democrats beat back attempt after attempt to gut President Barack Obama’s signature health care law. After Senate Democrats rejected the House’s year-long delay of Obamacare and a repeal of the medical device tax on Monday afternoon, Democrats returned to the floor after 9 p.m. to kill another House GOP proposal. The second measure would have kept the government open in exchange for delaying the health care law’s individual mandate and eliminating federal health care contributions for lawmakers and Capitol Hill aides. (Burgess Everett and Manu Raju, “Government Shutdown Update: Senate Rejects House Plan – Again,” Politico, 9/30/13)

According To The Congressional Budget Office, Delaying The Individual Mandate By One Year Would Reduce The Federal Budget Deficit By $35 Billion. “CBO and the staff of the Joint Committee on Taxation (JCT) estimate that enacting H.R. 2668 would reduce federal deficits by roughly $36 billion over the 2014-2018 period and by roughly $35 billion over the 2014-2023 period.” (Cost Estimate Of H.R. 2668: An Act To Delay The Application Of The Individual Health Insurance Mandate, To Delay The Application Of The Employer Health Insurance Mandate, And For Other Purposes, Congressional Budget Office, 9/6/13)

A July Poll Found That 77 Percent Of Registered Voters Support Delaying The Individual Mandate Or Repealing It Entirely. (Morning Consult Poll, 2,076 RV, MOE 2%, 7/24-26/13)

Member of Congress And Their Staff Are Required To Enroll In ObamaCare’s Exchanges. “Sen. Charles Grassley, R-Iowa, then succeeded in adding a measure to Obama’s health care bill three years ago requiring members of Congress and employees in their offices to leave the Federal Employee Health Benefits program and start buying their insurance through the state exchanges that open Tuesday under the Obamacare law.” (Laurie Kellman, “GOP demanded lawmakers pay more for health care,” The Associated Press, 10/1/13)

But OPM Granted Congress The Ability To Provide Subsidies, Which Are Not Available For Other Americans, To Help Purchase Insurance Though The Exchanges. “But the statute means that about 11,000 Members and Congressional staff will lose the generous coverage they now have as part of the Federal Employees Health Benefits Program (FEHBP). Instead they will get the lower-quality, low-choice “Medicaid Plus” of the exchanges. The Members-annual salary: $174,000-and their better paid aides also wouldn’t qualify for ObamaCare subsidies. That means they could be exposed to thousands of dollars a year in out-of-pocket insurance costs…And now the White House is suspending the law to create a double standard. The Office of Personnel Management (OPM) that runs federal benefits will release regulatory details this week, but leaks to the press suggest that Congress will receive extra payments based on the FEHBP defined-contribution formula, which covers about 75% of the cost of the average insurance plan. For 2013, that’s about $4,900 for individuals and $10,000 for families.” (Editorial, “Congress’s ObamaCare Exemption,” The Wall Street Journal, 8/5/13)

I listened to a recent episode of the Weekly Standard podcast, and guest Bill Kristol was advising the GOP to make exactly this proposal, saying that it was a strong move by the Republicans. I agree. We now have vulnerable Democrats going on record in favor of special perks for themselves and their staff, as well as the hated individual mandate. As soon as people see the sticker shock of being forced to buy insurance, or pay a fine, we are going to have a valuable tool in the 2014 elections. The left-wing media isn’t going to be able to protect the Democrats from their own votes.

UPDATE: The Weekly Standard approves of what the GOP is doing.

News

If Obamacare is so great, then why do so many Democrats get waivers?

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Investors Business Daily reports on who is getting exemptions from Obamacare.

Excerpt:

It’s bad enough that the administration has granted another 204 ObamaCare waivers. But even worse is that nearly one in five went to employers in the district of Rep. Nancy Pelosi, House architect of the bill.

It was Pelosi who said Congress had to pass the Democrats’ health care overhaul so the country could find out what’s in it.

Seems that quite a few businesses in her backyard found out what is in it and decided they didn’t like it.

According to the Daily Caller, 204 waivers for a provision of ObamaCare were approved last month — bringing the total waiver count to 1,372. Out of that April number, 38 of the waivers “are for fancy eateries, hip nightclubs and decadent hotels in” the Democrat’s hard-left San Francisco district.

The waivers, which the administration began granting only months after the bill was passed and signed, let employers avoid terms of the Patient Protection and Affordable Care Act that require health care insurance plans to carry at least $750,000 in benefits before being exhausted.

This requirement, found in the thousands of pages that make up the ObamaCare bill, is too costly for many businesses that can afford to provide health coverage only through less comprehensive plans.

The owner of Tru Spa, one of the San Francisco businesses granted a waiver, told the Daily Caller both ObamaCare and new local laws have “devastated” businesses in the region.

The employers that were granted waivers in Pelosi’s district include Boboquivari’s, a restaurant that, reports the Daily Caller, “advertises $59 porterhouse steaks, $39 filet mignons and $35 crab dinners.”

“Then, there’s Cafe des Amis, which describes its eating experience as ‘a timeless Parisian style brasserie,’ which is ‘located on one of San Francisco’s premier shopping and strolling boulevards.'”

Also among the 38 are the four-star hotel Campton Place and the self-proclaimed four-diamond Hotel Nikko.

While Pelosi’s constituents are being protected from her party’s health care wreckage, another Democratic constituency is being taken care of, as well.

A coalition of groups operating under the name wheresmywaiver.com says that “50.26% of waiver beneficiaries are unionized, despite union workers only making up 11.9% of the workforce.”

The Service Employees International Union, whose former President Andy Stern was one of the most frequent White House visitors before he was named to President Obama’s National Commission on Fiscal Responsibility and Reform, has been well-represented on the waiver list.

So have the teacher unions.

Organized labor, of course, is a heavy donor to Democratic candidates and was among the groups that pressed hard for Congress and the president to ram ObamaCare through the legislature and into Americans’ lives.

If ObamaCare is so vital to our national well-being, why are these unions and employers in a heavily Democratic district seeking relief from the burdens it imposes?

And why would Democratic Rep. Anthony Weiner, whose brilliant thought process led him to say “the bill and I are one,” ask for a waiver for his hometown of New York City?

This is what happens when the government takes money out of the private sector and lets politicians spend it. Especially left-wing politicians who are not inclined to cut taxes and reduce regulations.

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