Congressional Republican leaders are discussing proposals to attach a one-year delay of major elements of health reform, including the individual mandate, to legislation required to avert a government shutdown or prevent a default on the nation’s debt. We’ve issued a paper explaining why policymakers should firmly reject any such effort in light of the Congressional Budget Office’s confirmation that a one-year delay in the individual mandate would mean millions more uninsured people and higher premiums for many others, and which would create serious problems for the new health insurance exchanges just as the open enrollment season is about to begin.
Here’s an excerpt:
Specifically, a one-year delay of the individual mandate would raise the number of uninsured Americans by about 11 million in 2014, relative to current law, and would reduce the expected coverage gains under the Affordable Care Act by nearly 85 percent, according to a new Congressional Budget Office (CBO) estimate. Delaying the individual mandate also would raise premiums for health insurance purchased in the individual market in 2014, CBO finds.
Earlier CBO estimates indicated that permanently repealing the mandate would raise average health insurance premiums in the individual market — inside and outside the new health insurance exchanges — by 15 percent to 20 percent, amounting to hundreds or thousands of dollars a year in higher premium charges for large numbers of individuals and families. Without the individual mandate, the exchanges may well not be viable over the long run; the higher premiums would discourage many healthier people from enrolling, sending premiums up still more.
Indeed, that’s likely a core goal of those who seek a one-year delay. A year from now, they would demand another one-year delay and then another or outright repeal (especially if ACA opponents pick up more seats in coming elections). Thus, we should see the one-year delay for what it is — a central element of an effort to dismember health reform over the next few years.
Finally, a delay in the mandate would severely disrupt the open-enrollment season scheduled to start in just two weeks (on October 1), and likely push back the date at which coverage through the exchanges will first be in effect, now scheduled for January 1, 2014. Insurers have submitted premium rates for plans they will offer in 2014 based on the assumption that the mandate will be in effect, as the law requires. If Congress cancels the individual mandate for 2014, insurers will very likely withdraw their bids, demand time to calculate higher premiums, and submit new, and likely substantially increased, premium rates.