Healthcare

Rick Scott caves to health exchange, but other GOP-led states hang tough

Rick Scott caves to health exchange, but other GOP-led states hang tough

The Republican governor of Florida Nov. 16 confirmed he is working with the President Barack Obama’s administration to implement its health care reforms.

“The election is over,” Gov. Richard L. Scott, who was elected governor of the Sunshine State in 2010, said in last week’s speech to the 2012 National Lawyers Convention hosted by The Federalist Society. The society is a Washington-based organization whose members are drawn from the legal community and are committed to the “original intent” of the Constitution.

By doing so, Scott aligned with governors who have embraced the next big step in the Patient Protection and Affordable Care Act. But, many of Scott’s Republican colleagues have not. As of Nov. 19, 18 states will create a state-run exchange, 16 states will not and the federal government will have to step in, according to Kaiser Health News, which has been tracking the progress of the exchanges. Six states will forge a state-federal partnership exchange and 11 states are undecided. The District of Columbia is included in the states establishing its own exchange. Among the resisters are Utah, Wisconsin and Oklahoma.

Scott said now that the campaign is over, Health and Human Services Secretary Kathleen Sebelius is on his dance card. “I will sit down with Secretary Sebelius and see if we can work out a way that reduces costs, improves access and improves quality.”

There needs to be a break between the constant politicking and campaigning because elections are about problems, he said. “Good governing is about solutions.”

The governor said he hopes he and Sebelius can work out a solution for setting up either a state-run or state-federal partnership health care insurance exchange in Florida. The former hospital chain executive said he will approach the Obama administration the same way he resolved a 30-year litigation between the federal government with Florida over ecological management of the Everglades.

“We may not be happy with the current occupant of the White House, but the question is: ‘What are we going to do about it?’” he said.

Establishing state-run exchanges was a critical dodge in the health care reform debate. By making the exchanges function as state agencies, the president and Democrats could then argue that Patient Protection and Affordable Care Act was not a federal takeover of the health care industry.

State-run exchanges would be staffed and funded by the state, but the exchanges would be tightly controlled and directed by the federal government by the authority given it in Affordable Care Act.

Oklahoma lawsuit

Oklahoma has decided to do both nothing and something. With the full support of Sooner State Gov. Mary Fallin, who said she will not establish an exchange for her state, the state’s Atty. Gen. E. Scott Pruitt is suing to stop the implementation of the Affordable Care Act. Pruitt said Nov. 19 that the Oklahoma lawsuit was separate from the Affordable Care Act challenge case that was decided in the Supreme Court’s last term.

The Oklahoma lawsuit was filed in January 2011 and it is the only state-filed lawsuit left against the Affordable Care Act; it was stayed pending the resolution of other suits, he said. The stay has been lifted and the suit is active again.

Because the Supreme Court decreed the Affordable Care Act is actually a tax, Pruitt said, the federal government must follow the processes described in the Administration Procedures Act, which it is not, he said.

Wisconsin is still among the resisters. One leader in the ongoing fight against the Affordable Care Act, Sen. Ronald H. Johnson (R.-Wisc.) said Nov. 16 he welcomed Gov. Scott Walker’s decision not to set up an exchange in the Badger State.

“I fully support Governor Walker’s decision not to establish a state run health insurance exchange.  He is absolutely correct that the heavy hand of the federal government will allow him little if any flexibility in setting up and operating an exchange,” he said.

“He is also right to be concerned about the federal government’s ability to honor the promises it is making to fund the exchanges and the overall healthcare law,” Johnson said. “I will work closely with Governor Walker to limit the damage that this very partisan and unpopular law will do to Wisconsin’s healthcare system and to our state and federal budgets.”

Key timeline

All federal, state-run and state-federal-partnership health care exchanges are slated to be up and running as the act takes full effect Jan. 1, 2014.

Approaching that final operational deadline, there are incremental deadlines. The first was the Nov. 16 deadline for states to declare whether or not they would create an exchange or not. Responding to a letter from the Republican Governor’s Association request for an extension to the Nov. 16 deadline, Sebelius finessed the distinction.

In a Nov. 15 letter to the RGA, Sebelius wrote that she would conflate the notification deadline with the Dec. 14 deadline for the states to produce blueprints for their state-run exchanges. The secretary did not move the Feb. 15 deadline for states to produce blueprints for their state-federal partnership exchange. If the state does nothing, then the federal government will proceed with its own exchange.

Another leader in the fight against the Affordable Care Act, Sen. Orrin Hatch (R.-Utah) said, “That HHS decided to delay the deadline on exchanges is no surprise given the insufficient guidance and information that has been given to governors.”

Hatch, who is the senior Republican on the Senate Finance Committee, said the moving deadlines and confusing rules proves the act is a mess. “Frankly, that the exchanges are such a mess is pretty emblematic of how flawed the president’s health law is–with states having to bear the brunt,” he said.

Scott said he is anxious that his acquiescence to the federal health care regime is tantamount to his becoming the deputy of the federal government, rather than the leader of a sovereign state. But, it is the everyday reality of states that they accept federal funds and federal control of virtually all they do, he said. “All the money is free money—did they explain that to you? At least, that’s the way they explain it to me.”

Illinois is the next state smaller than Florida and Illinois is spending $90 million to establish its state-run health care exchange, he said.

“So, who is going to pay for that?” In the Affordable Care Act, health care exchanges are the federally mandated marketplaces, where individual will purchase health care insurance that each state is to set up. In the absence of a state-run exchange, the federal government will set up an exchange in its place.

Scott said he estimates the cost of maintaining an exchange would be another $90 million annually. “So, who’s going to pay for that?”

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