Health Care Policy Update: Warning: Train Wreck Approaching

Testifying before Congress this week, Health and Human Services Secretary Kathleen Sebelius dismissed concerns that the Obama Administration won’t have its health insurance exchanges up and running on time. She claims HHS is “definitely on track to implement the law as it is anticipated and have open enrollment start in every state in the country on October 1st.” 

This time it isn’t just health care law opponents who don’t buy her spin. Senate Finance Committee Chairman Baucus questioned the Administration’s implementation progress saying, “I’ve got to tell you, I just see a huge train wreck coming down ... consumers and businesses will just not have enough information … it will be too confusing.”

Even the HHS bureaucrats in charge of implementing the exchanges have lowered their expectations. Speaking at a national conference last month, a Centers for Medicare and Medicaid Services official who oversees exchange technology said: “The time for debating about the size of text on the screen, or the color, or is it a world-class user experience – that’s what we used to talk about two years ago. Let’s just make sure it’s not a third world experience.”

Congress gave the Obama Administration four years to get the health care law operational. The President’s time is running out – fast. He billed the exchanges as places people could easily learn about health insurance options and find out if they qualify for federal help to buy a new government mandated benefit plan. But HHS has already acknowledged that the exchanges won’t deliver on all the President’s promises. In March, the agency announced the law’s small business exchanges won’t allow employees to pick their own plans during the first year, even though the law requires it. HHS cited operational challenges for the delay.

The American people already know the application process could be a nightmare. In order to find out who is eligible to buy insurance, and how much subsidy help they get, the exchange has to consult a data-hub. That data-hub isn’t finalized yet. It is expected to merge income information from the IRS, disability information from the Social Security Administration, citizenship information from the Homeland Security Department, and income determinations for Medicaid coverage. States are scrambling to update their IT systems in order to talk to the hub. The bottom line: consumers may see long delays. People may take time to complete an online application only to find themselves wasting more time filling out a paper application.

The Obama Administration’s implementation track record has proven abysmal. HHS abandoned the CLASS Act because it could not be made solvent long-term. HHS blew through its $5 billion early retiree reinsurance program budget, and enrollment was suspended in May of 2011. Finally, HHS overestimated how many people would enroll in the Pre-Existing Coverage Insurance Program and underestimated how much it would cost to cover each person that did enroll. HHS struggled to make the $5 billion budget last through the end of the year, but the agency announced it has now run out of money. HHS suspended enrollment in the law’s high risk pool. Senator Baucus is right – we are headed for a train wreck.

Health Care Headlines

The Wall Street Journal: “Baucus Warns of Health-Law ‘Train Wreck’”: Top Senate Democrat Max Baucus is warning the Obama administration that he thinks implementation of the key pieces of the federal health-care law could turn into “a huge train wreck” if federal officials don’t pick up their pace in getting ready for open enrollment this fall.

The Washington Times: “Obamacare Creator Sen. Jay Rockefeller Now Says Law ‘Beyond Comprehension’”: Democratic Sen. Jay Rockefeller of West Virginia, a leading force in the creation of Obamacare, now says the health reform is at risk of falling under its own regulatory weight and that it’s becoming too complicated to properly implement.

The Washington Times: “Obamacare Creator Sen. Jay Rockefeller Now Says Law ‘Beyond Comprehension’”: Democratic Sen. Jay Rockefeller of West Virginia, a leading force in the creation of Obamacare, now says the health reform is at risk of falling under its own regulatory weight and that it’s becoming too complicated to properly implement.

Fox News: “Nation's biggest movie theater chain cuts workweek, blaming ObamaCare”: The nation's largest movie theater chain has cut the hours of thousands of employees, saying in a company memo that ObamaCare requirements are to blame.