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ObamaCare Fix Won’t Stop the Bleeding

President Obama is hoping today’s announcement that he will allow Americans who lost their coverage—despite his pledge—to keep it for another year will stop the bleeding on his signature health-care legislation. With his own party on the brink of a full-scale revolt as millions of Americans come forward to complain about cancelled plans and huge premium hikes, the White House knew he needed to say something to alter a national conversation in which his credibility is shot and his plan has been revealed to be mired in incompetence. But his faltering presentation before the White House press corps and the torturous explanations he offered won’t do much to bolster the country’s confidence in his ability to fix a problem that may be beyond even his considerable powers to solve.

His solution—an administrative fix of the law that would allow insurance companies to renew plans that had been canceled by ObamaCare—is intended to head off legislation authored by scared Democrats that would essentially undo a key provision of ObamaCare. But this fix effectively punts the ball to insurance companies and state regulators to implement it. That does give the president some new scapegoats to blame for the problem. But it’s far from clear that at this point he can put the genie back in the bottle. ObamaCare is a complicated scheme that even its authors don’t fully comprehend. By further diminishing the numbers of people who will be forced into the pool of ObamaCare customers, it’s entirely possible that this will begin to unravel the whole thing. Though the president kept returning to his gripes about “the darned website” not working—as if that were the only real obstacle to the law’s success—his main problem is the growing conviction that the plan is hurting as many if not more people than it is intended to help and that the government isn’t capable of running it. Today’s flat and rambling presidential remarks won’t alter that impression. Nor will it likely stop congressional Democrats and Republicans from passing legislation that will likely change the law in an even more far-reaching manner.

The main problem with the president’s fix is that the law it is intended to improve is so complicated and its effects so far-reaching that, as with the rollout, it’s not clear that the administration has thought it through. Having already upset the applecart of the insurance industry with this law, making the vast numbers of ObamaCare losers whole may not actually possible even if the president is pretending he can do so with one statement.

How state insurance commissioners and insurance companies are to reconstruct the plans that have already been canceled and which may also be again illegal in the not-so-distant future is a greater mystery than even the question of how or why the administration found itself unable to design a website that worked.

But even if we ignore the fact that this fix probably won’t fix much, the president’s uninspiring hour-long appearance did little to restore confidence that this plan can be changed in such a way that it will not hurt a great many middle-class people in order to help some of the poor. As I noted earlier this week, the conundrum facing the administration is that unlike past expansions of government that are frequently cited as precedents of ObamaCare, such as Social Security and Medicare, this law creates a vast class of losers along with some winners while potentially altering insurance, perhaps for the worse, for many others.

The difference between the one-year extension Obama offered and the proposed fixes offered by Democrats like Senator Mary Landrieu is that the latter are open-ended and offer permanent relief to ObamaCare losers. That won’t satisfy Americans who are no more likely to want higher premiums in 2015 than they will in 2014. That will, as with the employer mandate that the president has postponed, put off a lot of the pain until after the midterm elections in which ObamaCare is endangering the careers of many Democrats like Landrieu. But it’s unlikely that the senator or many of her colleagues want to go to the voters with that hanging over their heads. After surviving dozens of attempts by Republicans to repeal the law, it is this fact that is finally putting its future in doubt.

What the president doesn’t realize is that his oft-repeated pledge about letting people to keep their plans wasn’t a matter of bad communications but a scam that was necessary in order to pass a law that would otherwise have been defeated. Had more Americans, including Democrats, known that they would be the victims of the president’s law, they would have opposed it.

The bottom line here is that the president thinks minimal concessions such as the one he offered today will begin changing the momentum of the debate. But changing the rules after the fact in this manner may actually serve to help raise premiums even more and won’t change the fact that ObamaCare is at its core an effort to redistribute wealth, not insurance reform. Much of the public has only belatedly realized this fact. Try as he might, the president is not going to be able to lull them back to sleep.



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