New Obamacare setback: HHS delays online enrollment for small businesses

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Politics,White House,Barack Obama,Obamacare,President,Health and Human Services,Health Care,PennAve,Susan Crabtree,,Health Care Exchanges

The Obama administration is delaying yet another key piece of the new health care law - this time online enrollment for small business who want to sign up for the federal-run insurance exchanges.

A Health and Human Services (HHS) official said the department plans to immediately offer offline options for small businesses to sign up through an insurer, agent or broker in the nearly three dozen states where the federal government is running the marketplace. The website for small businesses to register and purchase coverage, though, will not launch until November of next year.

“For 2014, small employers will use 'direct enrollment' rather than in states where the federal government is running the marketplace,” the official said. “This allows small employers to sign up for coverage through offline enrollment while CMS [Centers for Medicare & Medicaid Services] works on creating a smoothly functioning online experience.”

The delay was first reported by Politico, which cited an HHS notice saying the department could “best serve small employers” by continuing an offline sign-up process while we concentrate on both creating a smoothly functioning online experience… and adding key new features, including an employee choice option and premium aggregation services by November 2014.”

Small businesses were supposed to be able to enroll in their own federal exchanges, known as SHOP, online from the start, but HHS delayed the online registration just days before the Oct. 1 launch. Officials said it would be available sometime in November, and small businesses have since been signing up in paper form.

Republicans immediately seized on the latest setback as another indication that Obamacare is full of bureaucratic glitches and doomed to fail.

Speaker John Boehner, R-Ohio, said the delay was “another broken promise and more proof this administration’s assurances have no credibility.”

“The president bit off more than he can chew with this health care law, and small businesses are now forced to bear the consequences,” said Boehner.

Republican National Committee Chairman Reince Priebus said the latest delay is more evidence that the law should be scrapped entirely.

“With each passing day, it’s clear how much worse Obamacare is than a website full of glitches. Yet again the administration has made a wholesale change to their signature piece of legislation because of the disastrous impact it is having on Americans,” he said, in a statement.

“It’s time we stop delaying pieces of ObamaCare and instead scrap it and start over with common sense reforms that will actually lower costs and increase access to care,” he added.

House Energy and Commerce Committee Chairman Fred Upton, R-Mich., questioned the timing of the announcement the day before Thanksgiving when Americans aren't focused on the news and said it mirrored the delay of the Obamacare employer mandate, which the administration announced the day before the July 4th holiday.

“Turkey is not the only thing being carved at the White House this Thanksgiving,” he said in a statement. “Just as it did over July 4 while we celebrated our independence, today the administration is doing its best to bury the latest confirmation that this law was not ready for prime time.”

CMS spokeswoman Julie Bataille told reporters Wednesday that officials decided to delay the online registration for small businesses to focus on resolving the website problems on for the vast majority of individual consumers.

“It was important for us to prioritize the functionality that would enable consumers individually to shop online for coverage,” she said.

The National Federation of Independent Business, which advocates for fewer government regulations, said the new delay will cause yet one more “onerous” paperwork requirement for job creators.

“Small businesses continue to be low on the priority list during the Obamacare implementation process,” said Kevin Kuhlman, NFIB's manager of legislative affairs. “It probably matters little to people in Washington that the failure to get the small business exchanges online adds yet another onerous paperwork requirement for job creators.”

The year-long delay for small businesses is an indication of how careful the administration is approaching its own Nov. 30 deadline for fixing problems with the website. Worried that the website could we overwhelmed this weekend and beyond, the administration reportedly has put off plans for promoting the site in December.

Bataille said those trying to fix the website are working furiously over the next three days on “software and hardware fixes” to build the website's capacity so that 50,000 users can access the site at one time without it crashing.

If the website experiences more than 50,000 users at one time after Saturday, Bataille said there will be an “advanced queueing” system in place that will send an email notifying users when they can return for a smoother experience or direct them to return during non-peak times such as early morning or night.

She said the website is already working far better than it did on Oct. 1 and will offer users a far smoother experience on Dec. 1. But she warned that Nov. 30 is not a “magical date.”

“[It] does not represent a relaunch – it is not a magical date,” she said. “There are times after Nov. 30 when the website, like all websites, will not operate well.”

The botched rollout of the website coupled with Obama’s broken promise that Americans could keep insurance plans they liked even under new Obamacare requirements has hurt the president in the polls and distracted attention from the rest of his second-term agenda.

Obama though has continued to defend the health care law, arguing that despite the technical problems, millions of Americans are benefitting from Obamacare.

This story was published at 1:22 p.m. and has been updated.

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