Obamacare: Now Officially a Hardship

December 21, 2013 Topic: Domestic PoliticsPolitics Region: United States

Obamacare: Now Officially a Hardship

New regulatory guidance effectively admits that the law is a source of trouble, and one from which Americans are entitled to relief.


“If you like your plan, you can keep your plan.” By now, every American has learned that oft-repeated promise by President Obama is—to employ a Nixon administration phrase—“no longer operative.”

That discovery came as those with individual health insurance started getting letters telling them that their plans were being cancelled and that they would need to buy new, Obamacare-compliant, replacement coverage. One response from Obama administration officials was to assert that the old plans were “substandard” anyway, and that the affected individuals could get better, more affordable coverage under Obamacare.


However, that explanation is now apparently “no longer operative” either, since recently the Administration released a “regulatory guidance” memo informing us that:

If you have been notified that your individual market policy will not be renewed, you will be eligible for a hardship exemption and will be able to enroll in catastrophic coverage if it is available in your area. In order to purchase this catastrophic coverage, you need to complete a hardship exemption form, and indicate that your current health insurance policy is being cancelled and that you consider other available policies unaffordable.

Obamacare stipulates that these so-called catastrophic plans must comply with all of the law’s new benefit mandates, but do not have to meet the same “minimum value” criteria imposed on other plans. Oh, and the plans also come with a standard deductible of $6,350 per person. Thus, an Obamacare catastrophic plan is—by both Obamacare’s own definition and design—a “substandard” plan.

So there you have it, ladies and gentlemen. The Obama administration has now issued a formal, public document clarifying the following as its official positions:

1) That being subjected to the disruptive and costly effects of Obamacare constitutes suffering a “hardship.”

2) That an Obamacare-imposed hardship is sufficient grounds for claiming an exemption from Obamacare.

3) That individuals who suffer the hardship of losing their previous, “substandard” insurance, will be granted relief by being allowed to purchase replacement insurance that is “substandard.”

These implicit admissions are stunning, to say the least. Given that this is part of the administration’s larger effort to suppress the rising tide of negative Obamacare stories simply makes the admissions even more flabbergasting.

The administration has now reached the point where its defense of its signature, revolutionary health-reform law is basically: “We’re replacing your substandard coverage with our substandard coverage.”

The distinction is that, before Obamacare, you could buy a plan with a reasonable premium and reasonable cost-sharing provisions, but without all the extra, expensive benefit requirements that the president, Nancy Pelosi, Harry Reid and the rest of Obamacare’s supporters thought you should have. Now, under Obamacare, you will lose that old plan, but can replace it with one that has all those extra mandated benefits, yet comes with higher premiums, higher deductibles, pays less of your medical bills and likely doesn’t cover some of your current doctors.

And for this improvement we are all supposed to be grateful? Bah, humbug!

Ed Haislmaier is a senior research fellow in The Heritage Foundation’s Center for Health Policy Studies.

Image: Flickr/Images of Money. CC BY 2.0.