This Time I Mean It: Obamacare Remix
For those who've managed to miss it, Democrats have recently battled a storm of political controversy over President Obama's 2009 promise that anyone who liked his current insurance plan could keep it. "Period." That was untrue, and as insurance companies have begun to announce cancellations, people are complaining.
In retrospect, this was a foolish thing for President Obama to promise, and an equally foolish thing for anyone to believe. Everyone knew that that the ACA came with new minimum standards and inevitably there would be plans that didn't meet them. If there weren't, we wouldn't have needed the new standards in the first place. In the language of economists it's called creative destruction and is an inevitable response to a radically changing marketplace.
This was going to happen. That doesn't excuse the President's decision to promise us the moon, and it doesn't make it a good idea for him to backpedal now.
To begin with, and in response to some early criticism of this decision, there's no serious question that President Obama has the power to do this.
The President through his agencies has the right to change enforcement of a law, just not the substance of it. Obama hasn't adjusted or removed the new coverage standards themselves but has rather announced that they won't apply for an additional year. Obama has always had the power to do this, a fact that the Supreme Court unanimously confirmed it in its 1984 decision Heckler v. Chaney .
Executive agencies have full discretion to enforce their laws unless Congress has specified otherwise. It's up to the Obama to execute the laws of the United States, and he has authority to decide the best way to do that. In this case, if President Obama believes that the law is best served by giving people an extra year to adjust to it, that's within his discretion unless Congress has specified otherwise.
As a spokesperson from the Department of Health and Human Services argued, "the Supreme Court held more than 25 years ago that agencies charged with administering statutes have inherent authority to exercise discretion to ensure that their statutes are enforced in a manner that achieves statutory goals and are consistent with other administrative policies ." That's about right. There's an argument to be made against this interpretation (that Heckler applied to the FDA's discretion over death row inmates, not insurance regulation), but not a good one.
Just because this is legal, though, doesn't mean that it's wise.
Let's be clear about why these policies are being canceled: they offer lousy health insurance. By definition, insurance companies have to cancel them, because they don't offer a minimum standard of care. It's not the fault of Obama or the ACA that the insurance companies offered lousy products. They were low cost alternative and people got what they paid for. But just because it would be cheaper to build a car without brakes, doesn't mean auto companies get to do so.