Saturday, November 16, 2013

Despite His Pronouncement, Obama Cannot Unscramble the Health Insurance Egg HE Broke

He twice said he was "not stupid" so why is he doing this?

Last Thursday, in a desperate bid to stop the political panic leading to desertion by House and Senate Democrats, Obama unilaterally announced that the provision of the ObamaCare law requiring insurance companies to cancel any plan the Obama Administration considers substandard would not be enforced for another year. He made it clear that he wished insurance companies to continue offering these plans to the people who currently hold them.

Apparently no one told him, nor did he stop to ask, if this was possible. Unlike the developers of the malfunctioning ObamaCare web site insurance companies had been preparing for this transition for three years. It's nothing short of an administrative nightmare to think they can turn on a dime and recreate the old policies in 30 days. Avik Roy, writing at Forbes, describes the challenge:
For the President’s “fix” to work, insurers will have to do something that is near-nigh impossible: reassemble the old insurance product within 30 days. That involves (1) negotiating 2014 reimbursement rates with doctors and hospitals; (2) figuring out how much such a plan should cost, given changing participants; (3) submitting the plan to state insurance regulators and gaining their approval; (4) marketing the plan to victims of cancellations; and many other things. I haven’t spoken to a single insurance executive who thinks that insurers are going to be able to get all that done.
Obama's declaration on Thursday is sure to introduce more chaos into the nation's health insurance marketplace, not less. But then, it will be easier for Obama to blame the insurance companies for the mess that he created. He said as much on Thursday:
OBAMA: “The key point is, is that it allows us to be able to say to the folks who’ve received these notices, look, you know, I, the president of the United States, and the insurance model of the Affordable Care Act is not going to be getting in the way of you shopping in the individual market that you used to have.”
He failed to mention that "the individual market you used to have" no longer exists. It was outlawed by ObamaCare. And just because Obama has dictated that the government will delay enforcement of that provision it does not make these policies legal. Former federal prosecutor Andrew McCarthy addresses that problem in a column at National Review Online. What kind of health security does it give knowing that the plan you buy is "illegal?" What risks does this entail for insurance companies knowing that these plans have no legality? Imagine the legal headaches this is going to cause. Would you buy a policy that was not legal and might not protect you?

McCarthy went on to question whether Obama has the authority to make this kind of sweeping declaration at all. But then, by now we're used to Obama unilaterally reinterpreting legislation enacted by Congress. If any Republican President had taken this many liberties with the Constitution Democrats would be marching in the streets demanding impeachment. (Well, they will probably do that no matter what. It's what they do).

Also on Thursday Obama said:
"I’m accused of a lot of things, but I don't think I’m stupid enough to go around saying, this is going to be like shopping on Amazon or Travelocity a week before the website opens if I thought that it wasn’t going to work."
This was shortly after he admitted that his administration didn't realize how "complicated" the ObamaCare web site would be to build. This raises another set of questions. Presidential speeches are not simply typed up and read. Ask anyone who has been there. Speeches are reviewed by multiple offices in the White House and by the agencies under discussion. Surely someone at the Department of Health and Human Services informed the White House things were not going well with the web site.

If Obama didn't know, why not? If Obama's "not stupid" it's hardly reassuring to admit he's incompetent. Remember that Obama was supposed to be "the smartest guy ever to become president," whose I.Q. was "off the charts." Obama once bragged that “I know more about policies on any particular issue than my policy directors.” Oh Really?

Republicans have offered a legal way out of this mess with the Upton bill that passed the House with 39 Democrat votes on Friday. It would have removed the legal tangle for insurance companies and insured for one year. Yet, the Obama Administration called it "sabotage" and threatened to veto it if it became law. They failed to explain why Obama's dubious declaration would be an improvement over the legitimate legislative process.

So what's Obama up to? Andy McCarthy suggests:
Obama is a charlatan, but not a stupid one. He knows what he did on Thursday was a legal charade. His “waivers” are no more about law than Obamacare is about delivering quality health care. Thursday was a performance contrived to set the insurance companies up. With Americans boiling over coverage cancellations, Obama publicly called on the insurers to offer policies that he well knows his own law makes illegal and that his “waiver” is powerless to legitimize. He desperately hopes Americans will be gulled into blaming the insurance companies for the catastrophe he has wrought. He would have gotten away with it a year ago. He won’t get away with it now.
The only real "fix" short or long term is the repeal of ObamaCare. Two more newspapers came out with editorials requesting just that. First, the Chicago Tribune said to "scrap" ObamaCare and "start over" while the Las Vegas Review Journal warns: "The Obamacare debacle is just getting started — and it only gets worse from here. Repeal and replace."

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