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Avik Roy: Utter Chaos: White House Exempts Millions From Obamacare’s Insurance Mandate, ‘Unaffordable’ Exchanges

POSTED BY Galen Institute on December 20, 2013.

It’s hard to come up with new ways to describe the Obama administration’s improvisational approach to the Affordable Care Act’s troubled health insurance exchanges. But last night, the White House made its most consequential announcement yet. The administration will grant a “hardship exemption” from the law’s individual mandate, requiring the purchase of health insurance, to anyone who has had their prior coverage canceled and who “believes” that Obamacare’s offerings “are unaffordable.” These exemptions will substantially alter the architecture of the law’s insurance marketplaces. Insurers are at their wits’ end, trying to make sense of what to do next.

 Previous fixes were failing

Here’s how we got to where we are. As many as six million Americans who purchase health coverage on their own have seen their plans canceled, because they don’t comply with Obamacare’s newly-imposed regulations. On the other hand, the bungled rollout of the law’s healthcare.gov website has meant that only tens of thousands of Americans have been able to enroll in new coverage under the law. This means that by January 1, 2014, less people will have health coverage under Obamacare than before.

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