President Barack Obama has decided to suspend penalties against several million Americans who have been unable to replace their canceled pre-Obamacare health plans with Obamacare-compliant plans by Jan. 1.
The presidential clemency partially suspends a primary directive of the law — that people will be punished if they don’t buy Obamacare insurance — and was announced the day before Obama departs for his Christmas vacation in Hawaii.
It was portrayed by officials as a benevolent response to worried Americans in states represented by six Democratic senators.
“We have heard from many of our constituents who are upset about the cancellation of their health care plans,” said a Dec. 18 letter from the six Democratic senators, including Louisiana’s Sen. Mary Landrieu. ”We believe it is essential that you further clarify what is defined as a hardship exemption” to the federal mandate, said the letter, which was released late Thursday night.
When granted by officials, the hardship exemption allows people to not buy insurance, or to buy cheaper bare-bones or catastrophic health-care plans, without suffering the Obamacare tax penalty.
“The President and I want to do everything we can to ensure that individuals with canceled plans have as many options as possible,” Secretary Kathleen Sebelius responded in a Dec. 19 message to Sen. Mark Warner, who had sought the presidential clemency for his state residents along with the five other senators.
“I can assure you that the exemption will be available to them,” said Sebelius’ letter — which does not suspend Obamacare’s prime directive — that the Democratic Party officials get to control the nation’s health sector.
The hardship decision announced Dec. 19 does not allow the roughly five million victims of Obamacare to regain the plans that were canceled by Obama’s law, which passed in 2010 without any GOP support in Congress.
The new hardship plan comes only a few days before the Dec. 23 deadline for buying insurance that is active Jan 1.
The new exemption was likely approved by Obama, because it violates a primary directive of his Obamacare network. That directive says Americans must buy Obamacare-compliant health-care plans, or else face tax penalties.
The plans are expensive, partly because they must include extra services, but also because the extra costs are used to subsidize health care for unskilled and poor people, such as high school dropouts and new immigrants. The hidden tax structure means that younger and skilled people end up paying extra to fund cheaper insurance for poor people and for older people, both wealthy and poor.
However, the lengthy and complex Obamacare regulations also allow young people to buy so-called “catastrophic” insurance for roughly 20 percent less than the cost of the cheapest Obamacare-compliant plan. Other Americans can buy those plans but only if they plead for so-called “hardship Exemption” that can be granted by officials.
Over the last few months, roughly five million people have been told their insurance plans will canceled Jan. 1 because of Obamacare regulations set by Obama’s deputies. Many of the Obamacare victims have been unable to buy replacement insurance plans, partly because of the cost of the new plans, but also because the only place to buy such the plans — the Obamacare website — remains incomplete after three years of development.
The Dec. 19 decision provides temporary and uncertain relief to the five million people whose existing insurance policies were canceled by Obama’s law. However, Obama and Senate Democrats are blocking a bill passed in July by the GOP-controlled House that would provide a one-year blanket exemption to all Americans from the Obamacare mandate.
The Dec. 19 indulgence provided by Obama follows several prior decisions to not enforce parts of the law. For example, Obama told companies that they would not be penalized if they don’t report the health-care benefits they provide to their employers in 2014. In November, Obama told companies he would not penalize them if they continue selling non-compliant plans in 2014.
However, the decision to not enforce Obamacare laws are echoed by the president’s decisions to not enforce other laws. For example, the president has minimized enforcement of immigration laws, declined to defend a federal law defining marriage, and has insisted that he can decide when the Senate is not in session.
Obamacare is increasingly unpopular among Americans, and even among people who don’t have health-insurance. The law’s unpopularity has hammered Obama’s approval to below 40 percent, and also threatens several Democratic Senators facing elections in 2014.
In October, Obama and allied Democrats in the Senate forced a shutdown of the government rather than delay Obamacare mandates or negotiate reforms to the Obamacare network with the GOP.