The Problem with Possibly Postponing the ACA’s Insurance Mandate

Yesterday, NPR’s Story of the Day podcast replayed a story from All Things Considered which discusses the problems created by the glitches in the governments Affordable Care Act (ACA) website. Some critics of the ACA are calling for a delay in the implementation of the insurance mandate.  If people cannot sign up for insurance with the government, how can the government penalize people for not having insurance?  As the story explains, the seemingly simple fix of delaying the insurance mandate is complicated. 

Here is are excerpts from the story: 

One of the big questions now circulating concerns what will happen if the website can’t be fixed soon. Will the government really penalize people for not having insurance if they can’t realistically buy it?

Technically, people are supposed to have coverage starting Jan. 1, 2014. But there’s a 90-day grace period, meaning you actually have until the end of March, which is also when the current open enrollment period ends. . . .

Even the administration says it wants to fix this. At a briefing Monday, White House spokesman Jay Carney said, “In terms of the Feb. 15 date that you just mentioned, there’s no question that there’s a disconnect between open enrollment and the individual responsibility time frames in the first year only. And those are going to be addressed.”

And if that mismatch does get changed, it would give people an additional month and a half to sign up without risking a penalty — and without extending the existing open enrollment date.

But what about the possibility of extending the enrollment period, which even some Democratsare now calling for if the website isn’t fixed soon? Or of waiving the penalty for the first year?

That’s where you start to run into big issues with the insurance companies that are offering these products in the exchanges. They set their premiums based on the rules as they’re written — that healthy young people would be strongly encouraged to sign up by the prospect of a penalty, and that they would be encouraged to sign up within this six-month window.