After months of assuring the public that everything was right on track, the Obama administration turned 180 degrees this month and announced that it was suspending implementation of the “employer mandate” provision of the Affordable Care Act for a year. They should not stop there. The troublesome “individual mandate” should be suspended as well and the whole rushed plan should be replaced with reforms that can give Californians better healthcare at a more affordable price.
First, the business mandate. Under the ACA, businesses with 50 or more full-time equivalent employees have to offer “affordable” health insurance to their employees or face a $2,000 fine for each employee (excluding the first 30).
Employers have been screaming for months about the complex, confusing and costly implementation of the ill-conceived law. With the little information they did have, they ran the numbers and started cutting hours or laying off employees to avoid triggering ACA penalties. Early results pointed to a disaster for business and for low-income California workers.
I applaud the President for delaying the employer mandate and hope he delays it again — forever — then moves on to the individual mandate.
Under the individual mandate, people will face a minimum penalty of $695 by 2016 if they do not purchase one of the costly plans required by the President’s reforms.
And for Californians, it will be costly. Healthcare analyst Avik Roy writes in Forbes magazine that health insurance premiums in California will increase between 64 and 146 percent under the ACA even though cost control was a central promise of the plan. Worse, the administration announced last week that it will not verify incomes for the massive subsidies provided to help offset these costs, laying the groundwork for a vast, expensive entitlement program with no accountability.
Like businesses, individual Californians deserve at least a one-year break from the overpriced and coercive plan, but if we could get out from under it forever we could make changes right here in our state that would get more people better and cheaper care without signing over 15-percent of our economy to the government.
We could start by eliminating any “standard benefit package” requirements and letting people buy customized plans that cover exactly what they need and nothing more, giving them the ability to purchase inexpensive plans from other states and demanding transparency in hospital pricing.
These pro-consumer moves would lead to far greater competition and ultimately to lower costs and better service for everyone.
We should also free up everyone involved in healthcare delivery and payment — insurers, individuals, medical device makers, hospitals, pharmaceutical companies — from unnecessary regulations, so they can innovate and deliver new, improved services at a better value for consumers. It is greater productivity — not price controls — that will ultimately rein in healthcare costs.
If it’s a good idea to suspend the business mandate for a year, it’s a good idea to suspend the individual mandate for a year. People are just as confused and just as shell-shocked about the astronomical price increases as businesses are. In fact, it’s a good idea to suspend it indefinitely until California gets the leadership in place that will try the many other reforms that can achieve the ACA goals of more and better care for less money.
Sen. Ted Gaines represents the 1st Senate District, which includes all or parts of Alpine, El Dorado, Lassen, Modoc, Nevada, Placer, Plumas, Sacramento, Shasta, Sierra and Siskiyou counties.