I still feel like I am living in some kind of surreality. Read Avik Roy’s insightful breakdown of the crazy events of the past day. But my mind is already wandering till next year.

The Administration is offering people (they say 500,000 but estimates range up to 12 million) the ability to buy catastrophic plans (which aren’t really cheaper because they don’t receive subsidies), and be exempt from the mandate (what mandate?) for the next year. Fine. This is crazy. But, what happens next year?

Let’s assume insurance premiums remain constant. Will it be any more affordable for those who had their policies cancelled to go ahead and buy insurance next year? Of course not. It will be *just* as tough.

Now, let’s factor in how the President’s decision to exempt millions of people from the risk pools will fudge up the pricing. Rates will go up! It will be even more expensive, and even more of a hardship to buy even a bronze plan. Will it not be a hardship next year?

And you can be damn sure, leading up to the election, the Administration will have every incentive to not alienate and piss off millions of voters. And, by delaying the mandate another year, you further the death spiral, which raises rates, which makes it even more of a hardship to buy insurance, which warrants more exemptions.

Do you get the pattern? I don’t see, feasibly, how the Administration cannot renew exemptions indefinitely, thus killing their own law.

And this assumes exemptions are limited to those who had their policies cancelled. What about people who can’t afford these policies, even with the subsidies? Is it not a hardship for them? You can expect the Administration to throw a lifeline to these people also, wedded with such discretion I can’t imagine. If this group is excluded from Obamacare, holy hell, the risk pools will be even more messed up.

I blogged the other day about “improvisational government.” They are just winging it here. Going from one crisis to the next. I  feel like Wesley Mouch and James Taggart are sitting in smoked filled room, trying to figure out how to survive the next emergency.

Obamacare’s biggest enemy now is not Ted Cruz, or the Tea Party, but Obama himself. The policies he is undertaking will destroy the law he created, to say nothing about alienating the insurers whose cooperation he needs. This law is unraveling.

Update: Igor Volsky at Think Progress makes a similar point:

Next year, people who apply for hardship waiver & sign up for catastrophic coverage won’t be able to keep coverage if they like it, right?

— igorvolsky (@igorvolsky) December 20, 2013

Update: An official would not answer if anyone else will be exempted:

“Is there going to be a single person in 2014 that’s going to pay the penalty? A single uninsured American that is going to end up paying the penalty in 2014 at this point?,” asked MSNBC host Chuck Todd.

“Chuck, I can’t talk to you about how many people are going to be subject to the penalty,” said White House deputy senior advisor David Simas, sidestepping the question. “I can say that in Massachusetts, you saw a rapid decrease in the number of uninsured because when they had choices, people signed up. And that’s what we’re seeing today.”