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Senator Joe Manchin is proposing a delay in a key component to the federal Affordable Care Act, the individual mandate. Manchin defended his legislation saying it allows the administration more time to fix glitches in the enrollment system, but a left-leaning policy group in Charleston maintains a delay will have significant negative impacts on West Virginians.
The individual mandate requires all Americans sign up for health insurance through the federal health care exchange by April 1, or face a penalty of $95 or 1 percent of their annual income, whichever is greater.
The penalty will be collected by the IRS and increases to more than $300 after the first year.
Manchin, however, said it’s too soon to punish Americans who are unable to sign up for health care because of problems with the federal enrollment website. He’s proposing that date be pushed back from April 1 to January 1, 2015.
“This should be a transition year,” he said in a conference call Thursday. “We’re seeing all the problems that they’re having rolling this thing out. It’s going to have some problems and they’re going to have to work through that, but people shouldn’t be facing a fine because they can’t log in.”
But Brandon Merritt, health policy analyst for the West Virginia Center on Budget & Policy, said the individual mandate is key and without it the Affordable Care Act will fall apart.
“The idea of the Affordable Care Act is to provide insurance to those who don’t have insurance and to help control the costs of insurance that has been creeping up for decades now,” Merritt said. “So, the individual mandate is what holds this together.”
Without that mandate, Merritt said healthy individuals won’t purchase plans, preventing more individuals from buying coverage and leaving insurance companies with a pool of sickly customers.
“Essentially what happens is that those who don’t seek as much treatment in any given year are helping cover the costs of those who do seek more treatment, and so under the Affordable Care Act, if the individual mandate is delayed likely what would happen is that only those who are sicker and going to require more care throughout the year are going to be the ones who purchase more health insurance,” Merritt said. “What that does is skews the risk pool so the health insurers essentially get set up with a sicker population that requires more treatment and is going to cost them more money.”
The more providers have to pay to cover their customers, the higher premium rates will climb thus preventing even more individuals from being able to access health care.
Manchin said that notion in Washington is being pushed by the insurance companies.
“I think everybody wants insurance if it’s affordable,” he said. “It’s part of who we are as Americans, but on the other hand, you have to have a marketable product. That’s where the insurance industry has to work with the administration and it has to be market forces that are driving it.”
Republicans have proposed similar delays in the hopes of preventing the ACA from taking root at all.
Manchin said his intention is not to get rid of the ACA in its entirety, but to put more pressure on the Obama administration and the industry to offer an affordable, quality product to consumers and to prevent Americans from being penalized before it is available.
“A lot of my colleagues keep saying delay, delay, delay. They want to delay it and never start it,” Manchin said. “Well, this is such a mammoth undertaking that you have to start down the road of (trying to work) within the marketplace, figure out where the problems are and if they can be fixed or not.”
Merritt doesn’t believe Manchin is trying to sabotage the bill’s implementation, but still, his analysis is blunt, saying straight out the senator’s plan won’t work. Merritt said now is not the time to tread lightly on a subject that affects thousands of West Virginians.
“While I understand Senator Manchin’s approach to say let’s try to find a common ground, I don’t think this is the compromise we really want to see because this is going to have negative impacts not just politically, but here in West Virginia with those who are unable to get insurance and those who do get insurance on the private market will see increased premiums,” he said.
“So, it’s really going to hit us here at home if we delay this aspect of the Affordable Care Act. I think it’s really important that we put it bluntly to say that this is a bad idea.”
When asked if the bill would receive a signature if it made it to the President’s desk, Manchin said he was unsure, but he hopes the bipartisan support will force the President to consider it.