Obamacare

Factual Questions
1

If this is not appropriate for GQ, please mods move it to wherever you think best.
I know ObamaCare has passed into law, but is it actually the law of the land yet? If I remember correctly, many states were filing lawsuits against the government because I assume costs associated with OC were being passed to the states. I also remember reading that states are waiting for the outcome of the 2012 election because if Obama doesn’t stay, the Repub. Admin will be rolling OC back off the books.

Can anyone give me the Straight Dope on this?

2

The Patient Protection and Affordable Care Act became law when it was signed by President Obama on March 23, 2010. The enforcement of certain parts of the act were stayed while various Constitutional questions worked there way through the courts. And certain parts (like the individual mandate) don’t come into effect until 2014. (That is to say, it is law now, but the law itself says it does not apply until 2014.)

3

Things don’t suddenly ‘switch’ overnight either, in many areas significant change is already underway - according to the former head of Medicare:

4

The Executive branch has no authority or power to repeal legislation.

5

True…perhaps that’s why the phrase “rolling off the books” was used. The Executive can enforce or not enforce all kinds of things as we see quite regularly from President to President.

6

What would you imagine would be the result if the President decided not to enforce the individual mandate?

7

Related Question: Can individual states “opt out” of Obamacare now? Since the only penalty for a state is the loss of its additional Medicaid funding, couldn’t it not accept these funds, not expand Medicaid, make the mandate and the tax/penalty not in force for its citizens, and the citizens still have the “no pre-existing conditions” benefit?

From my narrow understanding it looks like it will be a state by state choice whether to implement the mandate at all. Am I missing something?

8

I don’t see how the mandate is controlled by the states. If you don’t have insurance, it is a federal tax you will owe to the federal government.

However, I hope you are right. If the mandate is opt-out, but the pre-existing condition ban and other benefits remain, it will drive private health insurance into bankruptcy, because people can wait until they are sick to get insurance. If only sick people have insurance, it is an unsustainable model, and the only alternative will be single payer socialist health care like they have in Europe.

Be careful what you wish for.

9

I understand, but I was under the impression that if your state didn’t expand medicaid and didn’t offer the exchanges, that the tax/penalty and mandate did not apply, according to the law itself. Is that incorrect?

10

I don’t think that is true. The only sanction is for not expanding Medicaid; those states will not the receive federal funds for that purpose. I haven’t seen anything that suggested the mandate or the exchanges were optional.

11

From the other thread:

I know that the poster may be incorrect, but it makes sense. If they won’t expand Medicaid, how can poor people be expected to buy health insurance?

12

I think he is mistaken. Opting out of the Medicaid expansion doesn’t affect the mandate or the exchanges. As to poor people, they should address that problem to those who opted out of the Medicaid expansion. I expect when they see poor folks in other states getting subsidized health insurance, they will be less likely to vote for those who opted out of Medicaid.

13

Some states have previously experimented with many of the elements of the PPACA but without the individual mandate. That left pre-existing conditions covered and community rating. Insurers had to accept all applicants and could not charge higher premiums for those with pre-existing conditions.

In Kentucky all of the insurance companies but two closed shop and left the state. (One of the remaining companies was a state-run high risk insurer.) Premium rates skyrocketed. Similar financial disaster faced the insurance sector in Washington state. Ginsburg wrote in her opinion of the history of just such instances.
States can opt out of Medicaid expansion.

The PPACA stated the Secretary of Health and Human Services could pull all of such a state’s Medicaid funding. The court pulled that such a penalty was “dragooning” and unconstitutional.

The court looks at such agreements between the federal government and a state as a contract. The court essentially said that the PPACA was a new contract and that it changes the terms of a pre-existing contract. Because the financial coercion was so extreme the state did not reasonably have a choice and that is not constitutional.

After the ruling on the PPACA a state can opt out of the Medicaid expansion. If a state does so it simply will not get the additional federal funding that would have been given to cover newly eligible persons.

A state opting out of Medicaid expansion in no way affects the individual mandate provisions of the law. Residents of that state will still have to have insurance, pay a penalty, or have an exemption.
Certain individuals can opt out of Obamacare

The PPACA contains provisions for individuals to apply for an exemption to the individual mandate. Controversially, exemptions have been sought by, and granted to, members of certain labor organizations. They argue that their insurance policies are adequate even though the policy may lack some element that is deemed mandatory under the law.

Additionally certain persons or groups of persons may seek religious exemption to the requirements of the PPACA. Old order Amish, for example, have a long history of shunning government programs. Some Muslims argue that insurance is a form of gambling, prohibited by their faith.

Such exemptions are tied to a part of the IRS code regarding whether that religious group typically shuns Social Security benefits. Old order Amish traditionally refuse to receive Social Security benefits, and have a history of caring for their own. They will likely be eligible for an exemption to the PPACA.

Muslims more often accept Social Security as a means of taking care of the elderly and infirm. Those who do typically accept Social Security may not qualify for an exemption to the PPACA even if they consider such insurance contrary to their faith.

14

What would happen if a state refused to establish the exchanges?

15

I agree, that is likely to happen on a federal scale if the individual mandate had been overturned, or if states are permitted to opt out of the mandate. When it happens nationwide however, private insurers cannot survive, and we will have no alternative but single payer government health care.

16

As I understand it if a state refuses to implement an exchange then the citizens of that state can purchase from the federal-run exchange.

As NPR explained it this morning for MO (which is way behind on setting up anything, being rather conservative) there are three (eventually 4) options:

(a) Set up a state-run exchange that meets requirements
(b) Partner with the feds to run the exchange
© Just let the feds run it for you (or try to opt out but the feds will step in and run it for you)
(d) Get a state waiver (after 2017, maybe changed to 2014) if you can prove that you have achieved high enough coverage rates (Vermont and Washington are angling for this)

17

There’s still a lack of clarity on what the decision means for the working poor in states that opt out of the Medicaid expansion. The Act anticipated that these people would get Medicaid, and then anyone over a certain income level (139% of the poverty line, IIRC) would be mandated to get private insurance, and subsidized if necessary.

Now, if a state opts out, I don’t know, and I’m not sure if anyone yet knows, whether those people will be eligible for the subsidy. But be clear (and yes, I know I’m in GQ; I’m trying to keep it impartial) – opting out of coverage is not a substantive decision, but mere political theatre. The federal government pays 100% of the costs of the expansion for three years, then no less than 90% forever. Meanwhile, residents of opt-out states will still be paying for the Medicaid expansion through their taxes – the money will just be going to other states. No rational state governor or legislator would support that; no rational state voter would permit it. Now we get to see who’s rational.

–Cliffy

18

Lots of results… that’s not the point. Neither is my point limited to individual mandates.

My point is that the degree to which the entire bill is enforced is going to be dif depending on who the President is.

19

Yes, be careful for what you wish for indeed, because that’s not the only alternative. Another alternative is a complete lack of health coverage, where everyone has to sink or swim on their own. Which would of course be terrible, but it might be what inertia leaves us with if the current system collapses before a replacement is implemented.