Are the Updates to Obamacare Politically-Based?

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March 5 (Bloomberg) –- Manhattan Institute Senior Fellow Avik Roy and Bloomberg’s Megan Hughes discuss changes to the Affordable Care Act. They speak with Matt Miller on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

Happened.

-- fill us in on what just happened.

It is really a grab bag of fixed -- of exchanges, not just this two-year extension.

The irs and the treasury department were involved, as well as hhs.

They are giving states more time to decide if they want to have their own exchanges.

Insurers will have an extra month to sign people up in the open enrollment time frame for next year.

Basically, for 2015, they have taken a look at a number of things where there were concerns and complaints.

And there may be tweaks.

And that does include a two-year extension on people who were able to keep their noncompliant plans.

This is october of last year where people started getting cancellation notices.

Obama, of course, got tremendous backlash for his comment, "if you like your plan, you can keep it" and people were saying that he was not keeping that promise.

So they changed course.

They changed it on a state-by-state basis for people to keep their plans.

Many states did, and now they will have the option through 2017 to have these noncompliant lands that do not follow under the law.

They do not follow insurance plans that cover maternity care.

It was something that the president said repeatedly, over and over again, in order to get the people of this country behind his health care reform law.

You can keep your current health care plan if you like it.

It was a promise.

It was a statement that he made of fact.

Was the president lying to the american people directly knowingly, or did he not understand his own health care law?

There was a wall street article a few months ago that dug into this and found that the health care policies -- policy experts in the white house repeatedly tried to counsel the white house not to have this explicit declaration because it wasn't true.

Everyone knew it was not true.

The bill was designed to render those plans illegal.

But the white house said we cannot have any caveats, because that would risk failure of passing the bill and it would confuse people.

They knew what they were doing.

Though they were purposely lying to everyone?

Have we learned nothing from richard nixon?

It sounds ridiculous.

Megan just had a statement from john boehner.

You expect him and frankly, the wall street journal also, to write this kind of thing.

What is the backlash on capitol hill today?

Is it possible the president will allow us as he said he would to keep our health care plans if we like them?

One of the big questions swirling around this announcement is, was this a decision based on the midterm elections?

If you look at extending it for a year, that means people will be extending cancellation policies.

This is right around the time the senate is up for grabs and people are going to the polls.

It would obviously be a huge republican target, as it already is.

Americans for prosperity, the groups that they fund, they already have ads out.

It would have made this more of an issue and it would have been a bigger splash right before the elections.

White house officials today said absolutely not, this was not a political decision.

They make the case -- and russia didn't send any russian soldiers into the ukraine.

I knew you would be skeptical.

How could you not be skeptical?

There is no doubt that it was political.

The law passed by congress, the affordable care act, makes very clear that all of those old lands have to be illegal starting january 1, 2014. the executive branch does not have the authority to rewrite a congressional statute through regulatory action.

The legality of this move, there is no legal precedent -- actually, there is.

There is no legal justification for simply ignoring a congressional statute, saying, we have just decided that these plans that we said were not legal, we are now deciding that they are again.

Megan?

You don't buy that this was not a political move, but the other case that we are hearing from the white house is that this is a negligible amount of people.

At this point, somewhere between 500,000 and 1.5 million people, but as the years go on you will see more and people choosing to go on -- more and more people choosing to go on the exchanges.

A lot of people will just drop out, or their circumstances will change.

By the time we get to 2017 it will not matter.

We know that it is political, because the white house explicitly and overtly resisted this kind of move for a long time when a lot of other people were pushing for it, and only change their mind relatively recently when the news stories started to appear with people really angry, and the approval rating of the president sank.

And a lot of democrats who were nervous about 2014 lobbied the white house hard to change the stance.

This is not a policy the white house has always had.

They have always argued that you've got to have everyone in one pool, because that is the only way the exchanges will work.

The other thing i would say is, yes, it does matter.

What you will do now is create a precedent by if there is a republican president in 2016, he can just say, president obama delayed these provisions for the rest of his presidency, so why do i have to go forward with them?

He could just say, i will suspend the individual mandate, suspend these insurance regulations.

There is nothing the democrats will be able to do about it.

It's a good point, and even if the individual mandate comes back into play, assuming a republican wins office, i suppose he or she could suspend the individual mandate in the next presidency.

I do think there are probably some valid concerns about what kind of precedent this sets.

I'm not here to defend the white house.

They certainly believe these rules, these changes that they made for 2015 are within the letter of the law.

Maybe they are telling the truth this time.

This text has been automatically generated. It may not be 100% accurate.

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