Health-Care Retreat Leaves Doubt Over Obama's Clout in Party - Four take-aways from the president's change to the Affordable Care Act

From The Wall Street Journal:

President Barack Obama on Thursday announced an adjustment to the troubled health-care law, saying insurance companies could extend, at least for a year, those policies they had canceled for failing to meet the law's requirements.

It was a major policy retreat for Mr. Obama, who wants to end what he has called "substandard" policies and move people into plans offering more comprehensive coverage, often at higher premiums.

Here are four take-aways from the president's action:

Mr. Obama is in danger of losing his party.

 

The administrative fix wasn't sufficient for many fellow Democrats. On Friday, 39 House Democrats broke from their party and helped pass a Republican measure that would make bigger changes to the Affordable Care Act.

 

That was fewer defections than there would have been if Mr. Obama hadn't acted Thursday, but it was still a sign Mr. Obama is losing pull within his own party. After standing together against Republican demands for changes to the law during the government shutdown, some Democrats have been losing confidence in the administration's ability to manage problems with the law.

 

The defections go beyond House Democrats. Centrist Democratic senators up for re-election in GOP-leaning states, among them Mary Landrieu of Louisiana and Mark Pryor of Arkansas, have signed on to legislation to help people keep canceled plans. Even Sen. Dianne Feinstein (D., Calif.), who doesn't face voters next year, said she backed the legislation.

 

Mr. Obama's action relieved pressure on Senate leaders to advance the bill, but they say they stand ready to act if necessary.

 

Mr. Obama's ties to his party in Congress have never been especially tight. This struggle could leave them even weaker for the rest of his term.

 

The health-care law faces new risks.

 

The loudest criticism of the policy change came from the insurance-industry association that backed the law. It warned that the sudden reinstatement of canceled policies would further endanger the composition of the law's insurance marketplaces, or exchanges.

 

Insurers were already anxious about problems with the government website that individuals are encouraged to use to buy policies. They fear that only the most determined customers—those who are sick and most need coverage—will find a way through the malfunctioning website to purchase plans. That would leave insurers with high expenses and few healthy customers to balance the risk pool.

Now, they worry, Mr. Obama's move has revived plans that were bought chiefly by healthy people—giving them another incentive to stay out of the exchanges.

Mr. Obama isn't getting much of a boost from other policy initiatives.

The calendar and the congressional agenda offer Mr. Obama little help in regaining political momentum.

The president has met with evangelical Christians and other faith leaders, who are urging Republicans to move immigration legislation that has stalled in the House. But House Speaker John Boehner made clear he won't take up the Senate's broad bill.

The president's embrace of a boost in the minimum wage is expected to go nowhere in the GOP-led House. And prospects for a nuclear deal with Iran have hit turbulence.

Nov. 30 is the date to watch.

The administration has sought to reassure the public that HealthCare.gov will be working for the majority of users by the end of the month. It is using that assurance to push aside, for now, any talk that the government should delay the health law's individual mandate—the requirement that most people carry insurance or pay a penalty.

But Mr. Obama this past week played down expectations of how well the site will perform. "I think it's fair to say that the improvement will be marked and noticeable," he said. "The website will work much better on Nov. 30, Dec. 1, than it worked certainly on Oct. 1." If it isn't, expect panicked Democrats to call for more changes to the law.