Delaying Obamacare May Be Necessary To Save It

There are a couple of new stories out today that give more details on the troubles of HealthCare.gov, the federal health exchange. It’s a mess. From a New York Times article today:

Administration officials approached the contractors last week to see if they could perform the necessary repairs and reboot the system by Nov. 1. However, that goal struck many contractors as unrealistic, at least for major components of the system. Some specialists working on the project said the online system required such extensive repairs that it might not operate smoothly until after the Dec. 15 deadline for people to sign up for coverage starting in January, although that view is not universally shared.

That’s the worst case scenario and it looks like it may be the most likely one too. Starting January 1st, the individual mandate takes effect. That means that millions of Americans must sign up for health insurance before then. The law gives everyone a three-month grace period, but because of processing delays, you need to purchase insurance by Feb 15. After that, you’ll have to pay the prorated fine of either $95 or 1% of your income for not having insurance. That’s why that February 15 date is so important. What happens though if you spend months trying to sign up for Obamacare, but the website doesn’t work properly? Surely, the federal government can’t force you to pay a penalty for its failure. Without changes to the law though, we’re heading that way.*

The Obama administration has been adamant that it will not delay either the law or the individual mandate. It does not want to give any more time for Republicans to attempt to dismantle it, but time is running short. What happens if in a month, the exchanges are still not working? Will the administration have the political courage to stand up and say we need more time? Will Republicans allow a delay?

There’s another important point here: we can’t only delay the individual mandate. It shocks me how many conservatives have pushed for an individual mandate delay. That would eliminate the stick meant to bring young, healthy people to the exchanges to offset the influx of old, unhealthy people. It would likely bring about the dreaded death spiral where too many old, unhealthy people sign up for health care forcing insurance companies to raise premiums, which then scares away the most healthy people and forces insurance companies to raise premiums again and so on. The entire point of the individual mandate is to force those young people on to the exchanges. Without them, the law will fail.

As that February 15 date approaches, Republicans will see the political value of calling for an individual mandate delay. Imagine how easy it will be for any GOP congressmen to argue that the federal government is going to fine you for the failure of the exchanges. It’s a perfect talk point. Simple, easy to understand, and dead right.

That’s why the administration needs to get out ahead of this. If there is a decent probability that the exchanges won’t work in December, it’s time to take HealthCare.gov down and give the contractors an extra 3-6 months to work on it. The longer they wait, the worse it will look politically and the greater the chances that political pressure from the right will stop the law before it has a chance to get going. In the end, Democrats have control of the Senate and White House. If Obamacare is delayed until June, the Republicans will still have no leverage to attempt to stop it. Only Obama and Senate Democrats have the power to block the law. For the past two years, using that power to defeat the GOP’s attempt to undermine Obamacare was vital. Right now though, it’s looking more and more likely that the opposite is true. The greatest threat to the Affordable Care Act is no longer the Republican Party. It’s the law itself. Democrats need to start looking at that power as a way to save Obamacare, not a way to thwart the opposition.

*Thanks to Adrianna McIntyre for helping clear up some mistakes I made about the timing. Important date is February 15 for signing up for health insurance and avoiding the penalty, not December 15,

The Obamacare Fight May Not Be Over

Yesterday, Steve Benen wrote a post titled, “ACA repeal crusade over, ‘delusional folks notwithstanding’.” Here’s part of it:

Last year, Republican officials up and down the ballot argued the 2012 elections were the party’s last chance to derail the Affordable Care Act. Once they lost those elections, Republican officials declared, “Never mind what we said before; this budget fight really is our last chance to derail the Affordable Care Act.” And now they’ve lost this round, too.

There won’t be a third. The repeal crusade was a flop.

Sure, it’s possible congressional Republicans will vote a few more times to gut the law — at last count, I think we’re up to 46 repeal votes in the House — but it’s slowly dawning on the party that their dream will not be realized.

They can try to go through the motions in the months and years ahead, but it’s more likely to create eye-rolling than results.

I’m so tempted to agree with Benen. The law has been through so many challenges the past couple of years that it is just about set in stone. But I see one more possibility for how Republicans could derail it:

We’re two weeks into the open-enrollment period for Obamacare. This period lasts until March 31 and it’s the time when individuals can sign up for health insurance on the exchanges. On January 1st, Obamacare goes live and those health plans kick in. That’s when the law really starts. Right now, we’re still in the sign-up phase. So far, that sign-up phase has been an unmitigated disaster. If you’re an Obamacare supporter, you should be very, very concerned. By all accounts, the flaws in the online exchanges aren’t a result of traffic overload or glitches. They are much more systemic and widespread and will require a huge amount of work to get them operating properly. The Administration still has a lot of work to do.

In addition, the government shutdown has masked these problem. Some people think the problems are actually a result of the shutdown, which isn’t true. Once we’re past these fiscal fights, the media’s attention will turn to the mass problems with the exchanges. People will start realizing that there are serious issues here.

The question is how long they will last. If December comes and there are still issues, the Administration should become very worried that people will start seriously turning against the law. Of course, it will have nothing to do with the policy behind Obamacare, but a technical failure can still switch public opinion fast. If people lose faith that the government has the capability to implement it. they may give up. Imagine January 1st coming and people still having trouble signing up on healthcare.gov. That would be a colossal failure.

Two weeks after that, the continuing resolution in the Reid-McConnell plan expires. This would give Cruz and Co. yet another chance to try to spur grassroots support and demand a delay in Obamacare in exchange for funding the government. That plan blew up in their faces the last couple of weeks, but the Tea Party would have a lot more support this time around. Independents may start looking at those demand as reasonable if the exchanges are still having major troubles.

This is the final challenge for Obamacare: does it work? For months, the focus has been on rate-shock and whether the policy would help most Americans. Few people wondered whether the exchanges would actually function correctly. Now, that question is at the forefront of the debate. Under normal circumstances, a Democratic president and Democratic Senate would ensure that the law has plenty of time to work out its kinks, well past January 1st if necessary. They would accept the bad media coverage and keep working on healthcare.gov until they got it right. But the McConnell-Reid deal presents a potential opportunity for Cruz and the Tea Party to mount a grassroots effort that really could force the president to reexamine his greatest legislative achievement. It’s timed perfectly for Republicans to mount a serious challenge to defund or delay the law on legitimate grounds. The Administration ultimately controls the viability of this challenge, but the McConnell-Reid makes it possible. The Obamacare battles never seem to end.

Boehner Succeeds in Switching Demands

Ezra Klein picks up on an important point in this morning’s Wonkbook:

Two issues led to the shutdown. One was defunding or delaying Obamacare. The other, as Sen. Ted Cruz put it, was “making D.C. listen.”

What’s been remarkable — and largely unnoticed — is that Republicans have abandoned both those demands.

What’s odder about the shutdown, though, is that Republicans have also abandoned their core policy demand. They’ve largely stopped talking about Obamacare. They’re begging simply for negotiations. Their latest plan, in fact, is for another budget commission:

The GOP’s play, announced by Cantor at the meeting, is to push for a bicameral commission that brought comparisons to the “supercommittee” from the 2011 Budget Control Act.

In a Wall Street Journal op-ed, Paul Ryan articulates the emerging strategy. “To break the deadlock, both sides should agree to common-sense reforms of the country’s entitlement programs and tax code,” he writes. The word “Obamacare” never appears in the piece. Nor does any other reference to the president’s health-care law.

The Republican Party initially justified this shutdown and these tactics to itself by arguing that it was channeling the will of the people and justified by the dangers of Obamacare. But they’ve lost pubic opinion and realized Obamacare isn’t up for negotiation. But the loss of their original rationale for the shutdown hasn’t led them to reopen the government.

It shouldn’t surprise anyone that Boehner and Republican leaders first started by demanding the president defund or delay Obamacare. Speaker Boehner could not betray the Tea Party and split his party in half by bringing up a clean CR. Even if he had brought up a clean CR that also repealed the medical device tax, the Tea Party still would’ve been infuriated. It would’ve split the Republican party in half. This has clearly been the case all along and Boehner’s strategy has always been to slowly ratchet down GOP demands over time so that the Tea Party believes he fought for them. First it was defund Obamacare. Then it was delay Obamacare. After that it was delay the individual mandate. As Klein points out, GOP demands now have nothing to do with Obamacare.

Boehner knew all along Senate Democrats and Obama weren’t going to change the law. It was a non-starter. But he had to at least show his conservative members that he fought for them. Allowing a government shutdown to happen and drag out for a couple of weeks is a good way of showing them that.

His next step was to quietly switch demands from something unattainable to something possible. This was the toughest part as the Tea Party would revolt if it became clear he was giving up on their goal of stopping Obamacare. As Klein notes, this switch happened “largely unnoticed.” That’s a big victory for Boehner.

Now he still has to return to his party with some concession from the president. It doesn’t have to be much, but he can’t have chosen two major fiscal fights and return with nothing. He also must show that he fought as hard as he could – that means waiting until the last minute to make a deal. This is Boehner’s strategy in every one of these fights and it has succeeded repeatedly. In my first article defending Boehner, I wrote that his strategy is the following:

  1. Lie to his caucus, allow them to “take control” and make it seem as if disaster will strike
  2. Use that desperation to subtly change the conversation to the upcoming disaster and extract concessions from Democrats
  3. Go back to his caucus, say he got everything he could and convince them to vote to avoid the crisis at the last minute
  4. Keep his speakership by allowing himself to seem weak and extract some concessions
  5. Lather, rinse, repeat

Allowing the conservatives members to “take control” required shutting down the government this time. But the rest is unfolding exactly as I wrote. He lied to his caucus about stopping Obamacare, allowed them to “take control” and is now using that desperation to extract any type of concession from Democrats in return for opening up the government and raising the debt ceiling. He’ll then go back to his members, say he got everything he could and we’ll avoid a default. The Tea Party will be angry, but not quite angry enough to challenge his speakership. Lather, rinse, repeat. The hardest part was switching his party’s demands from stopping Obamacare to a fiscal concession. Now that he’s done that, the rest isn’t too difficult. It’ll just take until the 11th hour to play out.