Obama administration to allow exemptions to ACA individual mandate

This is why a single-payer healthcare system would have been a better option, in my opinion.

Today, the Obama administration announced that people whose insurance plans were canceled this year will “temporarily” be exempted from the law’s individual mandate. Here’s how they’re doing it — and what it means for the law.

1. The individual mandate includes a “hardship exemption.” People who qualify can either ignore the individual mandate altogether or purchase a cheap, bare-bones catastrophic insurance plan that’s typically only available to people under 30.

2. According to HHS, the exemption covers people who “experienced financial or domestic circumstances, including an unexpected natural or human-caused event, such that he or she had a significant, unexpected increase in essential expenses that prevented him or her from obtaining coverage under a qualified health plan.”

3. Today, the administration agreed with a group of senators, led by Mark Warner of Virginia, who argued that having your insurance plan canceled counted as “an unexpected natural or human-caused event.” For these people, in other words, Obamacare itself is the hardship. You can read HHS Secretary Kathleen Sebelius’ full letter here. HHS’s formal guidance is here.

4. How may people does this affect? No one quite knows. Republicans estimate that about 5 million people have seen their plans canceled. The Obama administration believes the number, at this point, is actually in the hundreds of thousands. There’s no truly reliable figure here.

5. The Obama administration argues that there’s little reason to fear that these people won’t purchase health insurance if they could otherwise afford to. After all, they were already buying health insurance on the individual market before there was any penalty at all. They clearly want health insurance. This just smooths their transition and, in the cases where there really is financial strain, gives them time to figure out a solution.

6. But this puts the administration on some very difficult-to-defend ground. Normally, the individual mandate applies to anyone who can purchase qualifying insurance for less than 8 percent of their income. Either that threshold is right or it’s wrong. But it’s hard to argue that it’s right for the currently uninsured but wrong for people whose plans were canceled.

7. Put more simply, Republicans will immediately begin calling for the uninsured to get this same exemption. What will the Obama administration say in response? Why are people who plans were canceled more deserving of help than people who couldn’t afford a plan in the first place?

As I’ve written time and time before, I’ve long believed that health care reform as implemented by the Affordable Care Act is overcomplicated and unwieldy, and I would have preferred simpler health care reform via a single-payer health care system.

Share:

Related Articles

5 thoughts on “Obama administration to allow exemptions to ACA individual mandate

  1. I totally agree with you. What I don’t understand is how can the administration just keep modifying the law without any Congressional action. Doesn’t seem right or legal for that matter.

  2. I agree on a simpler System. If the ACA had a public option at the National Level people could get affordable Health Care by skipping the States and Tort Reform would be a dead issue. Hind-site is always 20/20 and I cannot see the supreme court ripping out a plan for all Citizens set up the same way that Tri-Care works for veterans. Obama largely won the Democratic Primary in 2008 by being against the Individual Mandate, the exemptions are neccessary, I just wish we had not spent over 4 years of political capitol on not allowing exemptions.

  3. Thanks Zach,

    I agree with your sentiments on the ACA, this is getting curiouser and curiouser.

    @ Joe 10:53 am:

    Likely a secret legal memo like those supposedly justifying drone assassinations that neither Congress nor we the people don’t need to see. Not to worry. /s

    There goes my lunch hour. Later.

  4. Kelly Westlund was on the campaign trail over the last couple of weeks in her quest to oust Sean Duffy in the 7th CD, saying that she thought the ACA should be expanded to include a public option. I’ll be doing an interview for BB with her after the first of the year, but suffice it to say for now that I’ve found her to be unabashedly progressive, smart, tough, and eager to take Duffy on. 100 people attended her launch event at the Wausau labor temple on the 10th, and she joined a group of 50 people two days ago in front of Duffy’s office demanding that he take action to raise the minimum wage. And she’s said unequivocally that she’s opposed to GTac’s mine in the Penokee Hills, not just that she’s opposed to the new mining bill. We need more democrats like her.

Comments are closed.