How Are States Dealing with Health Reform Fallout?

Waiting on November elections

Opponents continue to work toward a full repeal in Congress, and presidential candidate Mitt Romney has made repealing the Affordable Care Act (ACA) one of his primary campaign points. Arizona, Kansas, Nebraska, and South Dakota continue to hold still or move slowly in anticipation of the November election.

Opting out of state exchanges and Medicaid expansion

Governors in Florida, Louisiana, Mississippi, Texas, South Carolina, and Wisconsin have publicly stated that they will not move forward with state exchanges or the now optional Medicaid expansion. Proponents of the ACA in these states are expected to push back hard.

Consumers who need insurance in states that do not have their own exchange will be eligible for participation in the federal health exchange, and the Department of Health & Human Services (DHHS) Secretary Kathleen Sebelius has stated that any uninsured who would have been covered by the Medicaid expansion will not be penalized by the individual mandate, although details on how this will work remain limited.

Continuing to move along with state exchanges and Medicaid expansion

Even as some state governors and policymakers are opposed to the ACA, many state legislatures and health advocates continue to work on a basic infrastructure. Fifteen states and the District of Columbia have either passed legislation or had an executive order signed to establish exchanges, and 10 states and the District of Columbia have already begun or are currently working on Medicaid expansion programs. Both Massachusetts and Utah already have exchanges up and running, and Massachusetts has already broadened its pool for Medicaid eligibility. Utah has not yet decided on Medicaid expansion.

Weighing options

In over 20 states, governors and legislators in both political parties continue to weigh their options between a federal or state exchange and are waiting for more federal regulations before making any decisions. Many states that have not yet created exchanges are already out of session for the year, and only one (Michigan) has a bill currently in session.

States are also scrambling to understand exactly how the Medicaid expansion could help or hurt their tenuous budgets. Although the federal government will pay 100 percent of the expansion for the first three years with a gradual decrease to a 90 percent share, even adding a small percentage of costs could be a heavy burden.

Democratic and Republican governors have voiced concern over the fine print, and both the National Governors Association and the Republican Governors Association have formally asked President Obama and DHHS to clarify the nuts and bolts of how the expansion will work.

August 2012 (Vol. 4, Number 8)