Nail in the coffin or bump in the road?

Since the passage of the Affordable Care Act slightly over three years ago, we’ve seen Congress repeal a tax, and the Senate move towards repealing a second one. We’ve also seen an entire provision, the CLASS Act, be done away with.

Now, a whole subsection of healthcare exchanges, those for small businesses, is being pushed back to 2015:

The Obama administration now says a special system of exchanges designed to make it easier for small businesses to provide insurance will be delayed an entire year — to 2015.

“Lots of small businesses struggle with providing insurance for their workers so this was supposed to facilitate it and make it easier for small business to do this,” said Jim Capretta of the Ethics and Public Policy Center. “It was a huge portion of the sale job. When they passed the law in 2010 there were many senators and members of Congress who were saying ‘I am doing this because it’s going to help small businesses.'”

The exchanges were designed to give workers a range of choices supported by dollars from their employers. But now they will have only one choice until 2015, which could mean they can’t shop for insurance that includes their current providers. Capretta said the administration is “way” behind schedule.

One business lobbying group says the delay is not a big deal:

“It’s a hiccup,” John Arensmeyer, president of Small Business Majority, a lobbying organization that has long supported the health care law, said in an interview. “It may have a brief impact on the pressures we hoped would push down cost, but the absence of these features for one year will not make a huge difference.”

An opponent of the law agrees:

“It’s a little more than a minor setback,” Kevin Kuhlman, manager of legislative affairs for NFIB, said about the administration’s announcement. “These small business exchanges were supposed to compete on price, quality and choice, and now you’re taking away that choice element for one year. So it’s a disappointment, but it‘s not the end of the world.”

So what are the real-world repercussions of the delay? Sarah Kliff at the Washington Post Wonk Blog says there are two major takeaways, depending on your perspective:

As to what this means for the larger health-care law, it seems possible to read it one of two ways. The first you might call the apocalyptic reading, that this is just the first in a long line of delays that will ultimately lead to the Affordable Care Act’s unraveling. The logistical challenges with this issue, cited by Health and Human Services, will quickly become clear in other parts of the law as we edge closer to 2014.

But there’s another reading of this, one that suggests the Obama administration has realized it can’t do everything and, in lieu of that, is smartly focusing on the absolutely essential parts of the health-care law, making sure that those do turn out well. HHS is in the middle of building dozens of complex marketplaces that it thought states would be managing, and doing so on an tight timeline.

Of Kliff’s two possible reactions, I definitely fall on the side of people who think this is just the first of many delays in implementation. While the Administration could be focusing its attention on the other parts of the law that are going downhill, and thus require a great deal of resources, that does not take away the importance of the delay. The simple fact is the federal government was probably not going to be able to administer the law in any sort of efficient fashion, and with a majority of states forcing the Administration to implement the state exchanges, that task has become monumentally more difficult.

Maybe the House of Representatives’ strategy will work after all…