Healthcare reporters have been in a frenzy to report this week that the ACA is a done deal and states should get on with it. The election certainly changes the dynamic in the repeal effort, as Speaker John Boehner indicated in a recent interview with ABC News, yet the implementation battle is far from over.
The next interesting story line is developing out of an OK lawsuit pertaining to the legality of subsidies being made available in the federal exchange. To be more specific, it challenges an IRS rule that imposes an ACA employer mandate where the statute does not appear to authorize it. If this case were to prevail, it would undermine the “fallback” federal exchange that is going to be established for states that opt to forgo setting up their own state exchange.
Governors in SC, GA, FL, KS, VA, MO are on record that they will not set up a state exchange. Most believe, minus the Democratic Governor of MO since a ballot question prevents him from unilaterally setting up an exchange, that the subsidies will not be available in the federal exchange, and will put the federal government between a rock and a hard place.
The election results at the state level also play into this story.
There are 30 Republican Governors, 24 of which have Republican majorities in both chambers. (Republicans control both chambers in 27 states overall, but those states have Democratic Governors, see below)
I expect a significant number of the 24 Governors with Republican majorities to take a pass on the state exchange option. However, I expect (and most have) the blue states will take a different path, so that leaves us the split states to watch.
We can remove VA and MO since they already are on record saying they will let the feds run an exchange.
While the media is moving on to the challenges of implementation, the real question remains how many states will even decide to take that first step of implementation. For many, that decision could be resting on a lawsuit that is still yet to be decided. Sound familiar?
Update: According to CQ HealthBeat, HHS will be setting a new deadline (the previous one was Nov 16th) for states that want to set up a state-based exchange, and implementing a rolling deadline for those interested in the partnership model. This could give state policymakers even more cover to wait till the OK case has been decided.
Josh Archambault is director of health care policy at the Pioneer Institute in Boston (www.pioneerinstitute.org), publisher of “The Great Experiment: The States, The Feds and Your Health Care.” This post appeared at The Pioneer Institute Blog.