States' choices set up national health experiment
BY RICARDO ALONSO-ZALDIVAR Associated Press
Saturday, February 16, 2013
2/16/13 at 5:57 AM
Read the Tulsa World continuing coverage of the health care law.
WASHINGTON - President Barack Obama's health-care overhaul is unfolding as a national experiment with American consumers as the guinea pigs: Who will do a better job getting uninsured people covered, the states or the feds?
The nation is about evenly split between states that decided by Friday's deadline they want a say in running new insurance markets and states that are defaulting to federal control because they don't want to participate in "Obamacare." That choice was left to state governments under the law: Establish the market or Washington will.
With some exceptions, states led by Democrats opted to set up their own markets, called exchanges, and Republican-led states declined.
Only months from the official launch, exchanges are supposed to make the mind-boggling task of buying health insurance more like shopping on Amazon.com or Travelocity. Millions of people who don't have employer coverage will flock to the new markets. Middle-class consumers will be able to buy private insurance, with government help to pay the premiums in most cases. Low-income people will be steered to safety net programs like Medicaid.
"It's an experiment between the feds and the states, and among the states themselves," said Robert Krughoff, president of Consumers' Checkbook, a nonprofit ratings group that has devised an online tool used by many federal workers to pick their health plans. Krughoff is skeptical that either the feds or the states have solved the technological challenge of making the purchase of health insurance as easy as selecting a travel-and-hotel package.
Whether the bugs get worked out, consumers will be able to start signing up Oct. 1 for coverage that takes effect Jan. 1. That's also when two other major provisions of the law kick in: the mandate that almost all Americans carry health insurance and the rule that says insurers can no longer turn away people in poor health.
Barring last-minute switches that may not be revealed until next week, 23 states plus Washington, D.C., have opted to run their own markets or partner with the Obama administration to do so.
Twenty-six states are defaulting to the feds. But in several of those, Republican governors are trying to carve out some kind of role by negotiating with federal Health and Human Services Secretary Kathleen Sebelius. Utah's status is unclear. It received initial federal approval to run its own market but appears to be reconsidering.
States setting up their own exchanges are already taking different paths. Some will operate their markets much like major employers run their health plans, as "active purchasers" offering a limited choice of insurance carriers to drive better bargains. Others will open their markets to all insurers that meet basic standards and let consumers decide.
A recent AP poll found that Americans prefer to have states run the new markets by 63 percent to 32 percent. Among conservatives the margin was nearly 4-1 in favor of state control. But with some exceptions, including Idaho, Nevada and New Mexico, Republican-led states are maintaining a hands-off posture, meaning the federal government will step in.
"There is a sense of irony that it's the more conservative states" yielding to federal control, said Sandy Praeger, the Republican insurance commissioner in Kansas, a state declining to run its own exchange. First, she said, the law's opponents "put their money on the Supreme Court, then on the election. Now that it's a reality, we may see some movement."
In some ways, the federal government has a head start on the states. It already operates the Medicare Plan Finder for health insurance and prescription plans that serve seniors, and the Federal Employees Health Benefits Program.
Administration officials are keeping mum about what the new federal exchange will look like, except that it will open on time and people in all 50 states will have coverage.
Original Print Headline: States define national health venture
Health care glance
The new health-care law was devised in Washington, but it's in the states where everyone will find out if it works. A thumbnail glance at how it's designed:
- From The Associated Press
- The Patient Protection and Affordable Care Act is the biggest safety-net legislation since Medicare and Medicaid in 1965.
- At a cost of $1.7 trillion over the next decade, it's meant to move the U.S. closer to other industrialized nations providing health care for all.
- Enrollment opens Oct. 1, 2013; coverage takes effect Jan. 1, 2014. It's expected to help about 30 million Americans who now lack health insurance.
- The law mandates that individuals have coverage, provides subsidies to help pay premiums and penalizes those who don't get the insurance. It imposes penalties on businesses with 50 or more full-time workers that don't offer coverage.
- Health-insurance exchanges set up in each state will offer subsidized private coverage to middle-class households. And Medicaid, the government's health insurance for the poor, will be expanded to cover low-income people making up to about $15,400 for an individual. States can opt out of the Medicaid expansion.