2013-07-08

Cato: Delaying the Employer Mandate Requires Delaying All of Obamacare

The IRS has announced it will postpone the start date of Obamacare’s “employer mandate” from 2014 to 2015. Most of the reaction has focused on how this move is an implicit acknowledgement that Obamacare is harmful, cannot work, and will prove a liability for Democrats going into the November 2014 elections. The Washington Post called the decision a “fresh setback” and a “significant interruption” to the law’s implementation. John McDonough, a prominent supporter of the law, observes, “You’ve given the employer community a sense of confidence that maybe they can kill this. If I were an employer, I would smell blood in the water.” When a die-hard Obamacare supporter like Ezra Klein says the employer mandate should be repealed, clearly things are not going well.
While all of this is true, it misses the two most significant implications of this momentous development:
First, the IRS’s unilateral decision to delay the employer mandate is the latest indication that we do not live under a Rule of Law, but under a Rule of Rulers who write and rewrite laws at whim, without legitimate authority, and otherwise compel behavior to suit their ends. Congress gave neither the IRS nor the president any authority to delay the imposition of the Patient Protection and Affordable Care Act’s employer mandate. In the section of the law creating that mandate, Congress included several provisions indicating the mandate will take effect in 2014. In case those provisions were not clear enough, Section 4980H further clarifies:
(d) EFFECTIVE DATE.—The amendments made by this section shall apply to months beginning after December 31, 2013.
It is hard to see how the will of the people’s elected representatives – including President Obama, who signed that effective date into law – could have been expressed more clearly, or how it could be clearer that the IRS has no legitimate power to delay the mandate. Again,Ezra Klein: “This is a regulatory end-run of the legislative process. The law says the mandate goes into effect in 2014, but the administration has decided to give it until 2015 by simply refusing to enforce the penalties.”
This matters because the Obama administration has abused nearly every power it possesses–and asserted powers it clearly does not possess–to protect Obamacare. A partial list of abuses: 
  • Obamacare, which Congress passed and President Obama signed, literally and immediately forbade the administration to provide health insurance to members of Congress and their staffs through the Federal Employees Health Benefits Program. That is, federal law required the Obama administration to throw nearly all members of Congress and congressional staff out of their health plans. But because that might lead Congress to reopen the statute, the Obama administration decided to keep providing that coverage to members and staff in violation of federal law, and has been doing so for three years.
  • Shortly after its enactment, Obamacare began increasing health insurance premiums. To prevent a(n even greater) backlash, Obama’s HHS Secretary Kathleen Sebelius started waiving select mandates for select companies and unions. Congress gave her no authority to issue such waivers.
  • When health insurers began to inform customers how much Obamacare was increasing their premiums, Sebelius threatened to use her powers under the law to bankrupt any insurer that conveyed an unapproved message about the law. All insurers quickly complied.
  • As it became clear that dozens of states would refuse to implement Obamacare’s health insurance “exchanges,” the IRS announced it would implement the law’s tax credits, subsidies, and taxes in states with federal fallback exchanges – even though Obamacare clearly, repeatedly, consistently, and intentionally prohibits the IRS from doing so. The IRS has literally asserted the authority to tax, borrow, and spend more than $1 trillion contrary to the express will of Congress.
  • Despite the Supreme Court’s ruling that the federal government cannot coerce states into implementing Obamacare’s Medicaid expansion, the Obama administration continues to coerce states into implementing most of the expansion’s provisions. The Court’s opinion flatly contradicts the administration’s claim that the ruling applied only to one part of the expansion. 
  • When it became clear that Congress would not fund Obamacare’s implementation, Sebelius decided she would again substitute her judgment for Congress’s by using money Congress had dedicated to other purposes. She has since approached companies she regulates to shake them down, tacitly, for funds to implement the law. 
  • And now, the IRS will delay the implementation of a central component of the law. Again, the administration is unilaterally rewriting federal law with the transparent purpose of avoiding an even greater political backlash against Obamacare.
The Obama administration’s zeal to protect this never-popular law is so great, whatwon’t they do to protect it?
Second, the employer mandate is so intimately tied to the rest of the law that the IRS cannot delay it without delaying the rest of Obamacare. 

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