Obama Gives Health Plans Added Two-Year Reprieve

Plans That Don’t Meet ACA Rules Could Stay in Place Through 2016.

The Obama administration further postponed a provision of the Affordable Care Act on Wednesday, the latest in a series of changes that have delayed or pared back the health overhaul so much that many of its ambitious goals won’t be achieved during its first years in full effect.

Democrats sought to create a new health-care landscape when they passed the law in 2010, with millions of uninsured Americans gaining coverage, employers facing fines if they didn’t insure workers and skimpy health plans disappearing.

But a series of delays by the administration—and decisions by states on implementing the law—have taken a toll. The latest delay came Wednesday, when federal officials said insurance companies could continue selling plans that don’t meet the law’s more rigorous standards until 2016 in some instances. It was the second time the administration delayed that requirement after the law’s tougher standards prompted insurers to cancel millions of people’s health plans last year. The latest delay averts another raft of cancellations before this year’s midterm elections.

Employers are largely sitting on the sidelines after the Obama administration twice delayed the law’s requirement that larger firms provide coverage or pay a fee. The rule was supposed to take full effect this year, but was first delayed until 2015 and now won’t kick in until 2016 for many firms.

Fewer Americans are expected to gain coverage under the law thanks to its troubled rollout, legal challenges and Republican opposition in many states. Problems with the HealthCare.gov insurance enrollment site initially discouraged consumers from signing up. About half of states have opted not to expand Medicaid eligibility under the law after the Supreme Court ruled they weren’t required to do so, leaving millions of low-income Americans with no subsidized options for gaining coverage.

“The Affordable Care Act has fundamentally improved the health-care marketplace, as it set out to do when the law passed,” said Obama adviser Phil Schiliro, who cited statistics about a recent surge in enrollments on the HealthCare.gov site, coverage extended to people under 26 years old and seniors saving money on prescription drugs.

In the Carolinas, “the notion of some kind of universal coverage, which I think was the essence of the act, just isn’t manifesting itself,” said Joseph Piemont, chief operating officer of the Carolinas HealthCare System, which includes 900 physician offices, hospitals and other care centers across North and South Carolina. Both states have chosen not to expand their Medicaid programs under the law.

But the law will only make a dent in the ranks of the roughly 50 million uninsured people in the U.S. in 2014. By 2020, there will still be 30 million people without coverage, according to projections by the nonpartisan Congressional Budget Office.

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