Tags: Exclusive Interviews | Healthcare Reform | troy | obama | obamacare | delay | employers

Former HHS Official: All Is Not Well in Obamacare 'Paradise'

Wednesday, 10 Jul 2013 10:30 PM

By Paul Scicchitano and John Bachman

Tevi Troy, a healthcare aide who served under former President George W. Bush, tells Newsmax TV that the Obama administration's decision to delay a key provision of Obamacare is a clear signal that "not all is well in paradise" with the president's signature healthcare law.

"It is interesting the timing of the announcement was right around 5 o'clock on July Fourth weekend and it was done by a deputy assistant secretary of Treasury that neither you nor anybody else in America ever heard of before," Troy, who was deputy secretary of the Department of Health and Human Services for the Bush White House, said in an exclusive interview on Wednesday.

"So they're trying to show a happy face to the world and say that 'everything's going along smoothly,' but the fact that they're delaying this essential provision to their law means that not all is well in paradise. And as I know from working in the administration, when you start delaying things, those things don't end up getting done."

Troy was reacting to the announcement that the Obama administration was delaying by one year the so-called employer mandate, requiring employers of 50 or more to offer healthcare.

He also questioned whether the critical healthcare exchanges will be ready by the promised Oct. 1 date.

"There will be some version of healthcare exchanging on Oct. 1 but there are no health exchanges, and if this individual mandate goes into effect, you could see some real chaos," explained Troy, who is now a senior fellow at the Hudson Institute. "People will be told they have to have health insurance but they may not have the ability to do so."

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A likely scenario is that "you're going to see costs go way up" and continued concern on the part of employers, fearing they will be hard-hit by the cost of Obamacare.

"These employers are still concerned — even with the one-year delay — about the cost of this, so they're more likely to dump employees," according to Troy. "You're not going to have these people have verification, so there's going to be a lot more people asking for subsidies."

Instead of being "budget-neutral" as initially promised, he said that congressional analysts now place the price tag for Obamacare at more like $2.7 trillion.

"The cost is just going to get higher and higher," he said, predicting that employers will react in one of three ways:
  • Keep the total number of full-time employees to 50, which is possible for small employers.
  • Limit employees to 30-hour work weeks, which would constitute part-time employment.
  • Drop some employees from health insurance altogether and pay a penalty, which has now been essentially waived for the first year thanks to the implementation delay.
"They're going to use different strategies to minimize the cost because, bottom line, employers are profit-maximizing institutions," he said.

Troy predicts that there will be "confusion" on Jan. 1, 2014, if the Obama administration proceeds with other parts of the program.

"The Obama administration isn't necessarily that skilled at giving forms that are easy to do, so the initial versions of the form are something like 21 pages," he explained. "They might work that out but the cost problem" is much more problematic.

Reacting to a move by the House to slash the IRS budget by 24 percent, Troy said he doesn't think such an action will ultimately stop Obamacare.

"They'll have fewer agents to enforce it, but you're still going to have it on the books and people will be obligated to get insurance or pay the penalty," he said.

He added that he believes Health and Human Services Secretary Kathleen Sebelius engaged in "inappropriate behavior" by soliciting funds on behalf of a nonprofit group to help sell Obamacare to the public.

"You really shouldn't have the chief regulator of the health industry going out there and soliciting these types of donations," he said, noting the Bush administration had received "strict rulings" on such practices.

"Here, we're talking about money that is not provided by Congress and she's trying to solicit outside funds to get things done that she wants done. That's a no-no."

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