Delaying the Employer Mandate Requires Delaying All of Obamacare

Townhall.com ^ | July 5, 2013 | Michael F. Cannon

[Kaslin]

The IRS has announced it will postpone the start date of Obamacare’s “employer mandate” from 2014 to 2015. Most of the reaction has focused on how this move is an implicit acknowledgement that Obamacare is harmful, cannot work, and will prove a liability for Democrats going into the November 2014 elections. The Washington Post called the decision a “fresh setback” and a “significant interruption” to the law’s implementation. John McDonough, a prominent supporter of the law, observes, “You’ve given the employer community a sense of confidence that maybe they can kill this. If I were an employer, I would smell blood in the water.” When a die-hard Obamacare supporter like Ezra Klein says the employer mandate should be repealed, clearly things are not going well.

While all of this is true, it misses the two most significant implications of this momentous development:

First, the IRS’s unilateral decision to delay the employer mandate is the latest indication that we do not live under a Rule of Law, but under a Rule of Rulers who write and rewrite laws at whim, without legitimate authority, and otherwise compel behavior to suit their ends. Congress gave neither the IRS nor the president any authority to delay the imposition of the Patient Protection and Affordable Care Act’s employer mandate. In the section of the law creating that mandate, Congress included several provisions indicating the mandate will take effect in 2014. In case those provisions were not clear enough, Section 4980H further clarifies:

(d) EFFECTIVE DATE.—The amendments made by this section shall apply to months beginning after December 31, 2013.

It is hard to see how the will of the people’s elected representatives – including President Obama, who signed that effective date into law – could have been expressed more clearly, or how it could be clearer that the IRS has no legitimate power to delay the mandate. Again, Ezra Klein: “This is a regulatory end-run of the legislative process. The law says the mandate goes into effect in 2014, but the administration has decided to give it until 2015 by simply refusing to enforce the penalties.”

This matters because the Obama administration has abused nearly every power it possesses–and asserted powers it clearly does not possess–to protect Obamacare. A partial list of abuses:

• Obamacare, which Congress passed and President Obama signed, literally and immediately forbade the administration to provide health insurance to members of Congress and their staffs through the Federal Employees Health Benefits Program. That is, federal law required the Obama administration to throw nearly all members of Congress and congressional staff out of their health plans. But because that might lead Congress to reopen the statute, the Obama administration decided to keep providing that coverage to members and staff in violation of federal law, and has been doing so for three years.
• Shortly after its enactment, Obamacare began increasing health insurance premiums. To prevent a(n even greater) backlash, Obama’s HHS Secretary Kathleen Sebelius started waiving select mandates for select companies and unions. Congress gave her no authority to issue such waivers.
• When health insurers began to inform customers how much Obamacare was increasing their premiums, Sebelius threatened to use her powers under the law to bankrupt any insurer that conveyed an unapproved message about the law. All insurers quickly complied.
• As it became clear that dozens of states would refuse to implement Obamacare’s health insurance “exchanges,” the IRS announced it would implement the law’s tax credits, subsidies, and taxes in states with federal fallback exchanges – even though Obamacare clearly, repeatedly, consistently, and intentionally prohibits the IRS from doing so. The IRS has literally asserted the authority to tax, borrow, and spend more than $1 trillion contrary to the express will of Congress.
• Despite the Supreme Court’s ruling that the federal government cannot coerce states into implementing Obamacare’s Medicaid expansion, the Obama administration continues to coerce states into implementing most of the expansion’s provisions. The Court’s opinion flatly contradicts the administration’s claim that the ruling applied only to one part of the expansion. 
• When it became clear that Congress would not fund Obamacare’s implementation, Sebelius decided she would again substitute her judgment for Congress’s by using money Congress had dedicated to other purposes. She has since approached companies she regulates to shake them down, tacitly, for funds to implement the law.
• And now, the IRS will delay the implementation of a central component of the law. Again, the administration is unilaterally rewriting federal law with the transparent purpose of avoiding an even greater political backlash against Obamacare.

The Obama administration’s zeal to protect this never-popular law is so great, what won’t they do to protect it?

Second, the employer mandate is so intimately tied to the rest of the law that the IRS cannot delay it without delaying the rest of Obamacare.

In addition to penalizing employers that fail to offer acceptable coverage, Obamacare offers tax credits and subsidies to certain workers who don’t receive an offer of acceptable coverage from an employer. The law requires employers to report information to the IRS on their coverage offerings, both to determine whether the employer will be subject to penalties and whether its employees will be eligible for credits and subsidies.

The IRS both delayed the imposition of penalties and “suspend[ed] reporting for 2014.” As the American Enterprise Institute’s Tom Miller observes, without that information on employers’ health benefits offerings, the federal government simply cannot determine who will be eligible for credits and subsidies. Without the credits and subsidies, the “rate shock” that workers experience will be much greater and/or many more workers will qualify for the unaffordability exemption from the individual mandate. Either way, fewer workers will purchase health insurance and premiums will rise further, which could ultimately end in an adverse selection death spiral. The administration can’t exactly solve this problem by offering credits and subsidies to everyone who applies, either. Not only would this increase the cost of the law, but it would also lead to a backlash in 2015 when some people have their subsidies revoked. 

I can’t see how the IRS can delay only the employer mandate. Perhaps Congress should offer to delay the rest of the law, too.

[BenLurkin]

...we do not live under a Rule of Law, but under a Rule of Rulers who write and rewrite laws at whim, without legitimate authority, and otherwise compel behavior to suit their ends...

It has certainly come to look that way.

[GraceG]

If all laws were equally enforced then there would be by necessity less stuipid laws....

And less laws and regulations all together.

[Menehune56]

The problem for the opposition party is if they object on this point, they're put into the position of arguing for imposition of this cluster.

[Kaslin]

It sure has

[SDShack]

To your second point, I agree totally. My first response to this announcement was how can this not violate the equal protection clause of the constitution? By selectively not enforcing the law, this actually penalizes some employees (because they won’t qualify for subsidies) while rewarding others who will get the subsidies because the employer is compliant. The effect is a penalty to some, but not due to the employee’s action. Your post helps clarify this for me. Thanks!

[Joe Bfstplk]

No matter what the ass0 president says, I believe employers will set themselves up for serious monetary penalties if they do not divest themselves of employees and adjust hours of employment. I trust this administration like a den of rattlesnakes.

[Rome2000]

This is exactly the reason the Founders did not put a right to vote in the Constitution and were against Universal Suffrage

[Conserev1]

Obama just proved he can circumvent SCOTUS and a law that was verified buy JOHN ROBERTS Supreme Court Justice!
That Law WAS UPHELD as LAW of the LAND!
In retrospect the laws of the United States of America can be circumvented totally By your Dictator in charge that was key to the implemptation of said law!! In reality POTUS becomes Dictator! We are now under oppression by our new Bannana Republic Government
IF the SCOTUS cannot uphold Law in our Country Who Can?
Nancy Pelosi?
Do not get me wrong the ACA is not a good Bill! But it is LAW!

[PeevedPatriot]

I've been thinking about this from the standpoint of Medicaid expansion. PPACA hits employers with additional taxes if any full time employees (or their dependents) qualify for subsidies. But what about Medicaid? I can't remember whether there's a similar tax on employers when fulltime employees (or their dependents) enroll in Medicaid. Anyone know?

I think part of the reasoning behind this delay in enforcement is to further expand Medicaid and support aspects of the law that are intended to eventually usher in a single payer system. There's a waiver for states that want their own innovative program (i.e., single payer) and I believe it starts in 2017. The cynic in me thinks this delay helps states inclined toward single payer avoid some of the costs of setting up an exchange now only to abandon it in 2017 when they intend to go for a single payer waiver.

[Brad from Tennessee]

Yeah, he's right—delaying the employer mandate potentially creates a bigger mess than it solves. But the ultimate goal of ObamaCare is single-payer health care. The law is written to gradually force private insurers out of the market and for employers to drop employee health benefits in favor of a less costly annual penalty.

It's been argued that the law is structured to deliberately cause chaos. We're just seeing the beginning of the chaos. Congress may finally view the simplest remedy to be amending ObamaCare to a single-payer system.

[huckfillary]

Obamacare is the ultimate clusterf**k. Just kill the damn thing.

[zeestephen]

The author lists six bullet points of previous Constitutional abuse by Obama and Obama appointed administrators.

Yet, I cannot recall ONE serious action by GOP Congressmen to stop those abuses.

Did the GOP controlled House ever vote to repeal ObamaCare?

I know they threatened to, but I cannot recall if they did.

I know that many RINO’s and neo-Cons urged them NOT to repeal it because the voters might “misunderstand” the GOP’s motives.

[DPMD]

Obama to all those Americans looking forward to having free health insurance by Jan 2014:

Screw you.

[Graewoulf]

Repeal and Abolish Obama’care.’

[TBP]

The delay is not legal, and someone should sue to force immediate implementation. (Meanwhile, the IRS should be defunded so it can’t enforce any part of the bill.)

[PeevedPatriot]

Congress may finally view the simplest remedy to be amending ObamaCare to a single-payer system

They don't have to amend the law. Section 1332 already takes care of it by encouraging states to enact single payer on their own after 2017 under the guise of innovative state programs. States that receive a waiver can avoid the costs of the exchanges and divert to their own coffers the subsidies and tax credits that individuals would have received to help pay for private coverage.

It's been argued that the law is structured to deliberately cause chaos.

Yes. Add in a lawless administration and it's even worse.

[TBP]

“we do not live under a Rule of Law, but under a Rule of Rulers who write and rewrite laws at whim, without legitimate authority, and otherwise compel behavior to suit their ends.”

http://www.enterpriseintegrators.com/flint/4thR/TomSmithsIncredibleBreadMachinePoem.txt

They’d surely been misled;
No rule of law had he defied.
But the their lawyer said:
“The rule of law, in complex times,
Has proved itself deficient.
We much prefer the rule of men!
It’s vastly more efficient.
Now, let me state the present rules,”
The lawyer then went on,
“These very simple guidelines
You can rely upon”
You’re gouging on you prices if
You charge more than the rest.
But it’s unfair competition
If you think you can charge less.

“A second point that we would make
To help avoid confusion:
Don’t try to charge the same amount:
That would be collusion!
You must compete. But not too much
For if you do, you see,
Then the market would be yours
And that’s monopoly!”

Price too high? Or price too low?
Now, which charge did they make?
Well, they weren’t loath to charging both
With Public Good at stake!

In fact, the went on better
They charged “monopoly!”
No muss, no fuss, oh woe is us,
Egad, they charged all three!

[kaehurowing]

The problem is that premiums have already skyrocketed, in the case of my company, rates have increased 76% since Obamacare became law.

[Taxman]

LETS KILL OBAMACARE!

NOW!