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With Obamacare, Implementation is Tricky

Tevi Troy

It would be a mistake to see the writing of the health care bill as now complete. Congress has determined the basic architecture of the bills—a mandate for individuals to purchase health insurance, subsidies to purchase insurance, and new regulations on insurers—but the actual building blocks of the bill will be determined over the next few years as the executive branch works to implement the new legislation.

The legislative process gets the headlines, and this one generated more than its share of them, but experience shows that the implementation period is crucial to determining how successful the new system can be.

As most people who have been following the debate know, the new taxes and Medicare cuts called for in the bill will take place almost immediately, but the “goodies”—the new health care exchanges and the subsidies for those without insurance—will not kick in until 2014. Budget legerdemain is part of the reason behind the long implementation period.

The Democrats needed to frontload the taxes and Medicare cuts and backload insurance subsidies in order to make the respective health bills score as deficit neutral in the first 10 years. Yet implementation is an exceedingly complicated task, and multiple federal agencies, supervised by the Office of Management and Budget and the White House, have a lot of work to do before the new laws will come close to meeting Congress’ goal.

As Kaiser Family Foundation Drew Altman has written, “Implementation is not self-executing.”

As a result, the shape of the new law will not become clear once the bill passes and is signed. The administration and personnel in charge of the implementation will have a great deal to do with the final structure of the new law.

Congress’ decisions only open the door to a host of complicated and controversial decisions that still need to be made. While the executive branch does not get to write the legislation, it does get to write the rules that determine how the legislation goes into effect, and a Democratic administration will likely do this differently than a Republican administration would.

Furthermore, even though the period between now and 2014 seems like a long time, there’s a good chance that it may actually be too short a time frame to get the job done. According to a recent analysis by Rutgers Public Policy Professor Stuart Shapiro, the mean time for completing a regulation from start to finish is 831 days—about two and a third years.

Complex rules—and this package certainly qualifies—take even longer.

All of this means that the passed bill comes nowhere near to ending our long, unpleasant debate on the health care issue. Our last major health reform, the creation of the Medicare Part D program, passed in 2003. When it was finally implemented in 2006, it opened up a whole new public relations war on whether the implementation was done correctly, and whether the legislation should have passed in the first place.

The Bush White House and Secretary Michael Leavitt at HHS kicked into high gear both to fix the initial glitches and to counter accusations of a botched kickoff. They succeeded in righting the ship—the program now has satisfaction rates in the high 80s—but success initially seemed far from certain. A similarly difficult unveiling could very well greet this new bill as well.

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