Administration Delays Signing Up Insurance Plans for Obamacare Exchanges
Another Glitch in Obamacare Launch
While war drums in the Middle East distract the nation, the administration quietly announced Tuesday that the government will delay signing up insurance plans for the opening of the Obamacare insurance exchanges on October 1.
With little fanfare or explanation, the Department of Health and Human Services (HHS) delayed the signing of final agreements with insurance plans to be sold on the exchanges. HHS said it will not sign final agreements with insurance plans in early September, but will delay reaching final agreements until later in the month.
The delay is reported to be to be attributable to technical problems in displaying insurance plans on the exchanges. The exchanges open on October 1 and will remain open during a six-month enrollment period.
The HHS announcement is another example that Obamacare is not ready for prime time. The delay in signing up insurance plans comes after widespread privacy concerns about the security of technology that will collect private information from exchange enrollees.
But Tuesday’s announcement is different. The October 1 opening of insurance exchanges is the focal point of Obamacare before the program kicks in on January 1. Enrollment in the exchanges is crucial to the success of the program.
Insurance plans will be sold in federal exchanges set up in 34 states. The remaining 16 states are responsible for their own exchanges.
Without final agreement on approved insurance plans, the exchanges cannot open. Meanwhile, the government is spending millions in advertising and public relations programs to sign up as many enrollees as possible during the six-month enrollment period.
“It makes me wonder if open enrollment can start on October 1,” a former administration official said.
The official went on to say that a “substantial setback” to Obamacare would occur if there were a delay in the January 1 launch of the whole program.
The delay in signing up insurance companies for the exchanges follows controversy over other delays and adjustments to the health care program. Last month the administration gave businesses a one-year reprieve from complying with a mandatory requirement to provide employee insurance. Then the president brokered a deal to exempt members of the House and the Senate and their staffs from Obamacare.
Right on schedule, the Internal Revenue Service issued final rules Tuesday for individuals who will face penalties if they fail to buy insurance. Individuals will be subject to a $95 per person per year penalty in 2014, rising to $695 by 2016.
While the government struggles to open the Obamacare exchanges, the IRS is ready to collect penalties. First things first.