Obama’s Health Care Overhaul Turns Into a Sprint
By Ricardo Alonso-Zaldivar Associated Press November 8, 2012
Its place assured alongside Medicare and Medicaid, President Barack Obama‘s health care law is now in a sprint to the finish line, with just 11 months to go before millions of uninsured people can start signing up for coverage.
But there are hurdles in the way.
Republican governors, opposed to what they deride as “Obamacare,” will have to decide whether they somehow can join the team. And the administration could stumble under the sheer strain of carrying out the complex legislation, or get tripped up in budget talks with Congress.
“The clarity brought about by the election is critical,” said Andrew Hyman of the nonpartisan Robert Wood Johnson Foundation. “We are still going to be struggling through the politics, and there are important policy hurdles and logistical challenges. But we are on a very positive trajectory.” Hyman oversees efforts to help states carry out the law.
In the two years since passage of the Affordable Care Act, the Obama administration has been consumed with planning and playing political defense. Now it has to quickly turn to execution.
States must notify Washington a week from Friday whether they will be setting up new health insurance markets, called exchanges, in which millions of households as well as small businesses will shop for private coverage. The Health and Human Services Department will run the exchanges in states that aren't ready or willing.
Open enrollment for exchange plans is scheduled to start Oct. 1, 2013, and coverage will be effective Jan. 1, 2014.
In all, more than 30 million uninsured people are expected to gain coverage under the law. About half will get private insurance through the exchanges, with most receiving government help to pay premiums.
The rest, mainly low-income adults without children at home, will be covered through an expansion of Medicaid. While the federal government will pay virtually all the additional Medicaid costs, the Supreme Court gave states the leeway to opt out of the expansion. That gives states more leverage but also adds to the uncertainty over how the law will be carried out.
A steadying force within the administration is likely to be HHS Secretary Kathleen Sebelius. The former Kansas governor has said she wants to stay in her job until the law is fully enacted. “I can’t imagine walking out the door in the middle of that,” she told The Kansas City Star during the Democratic convention. Her office declined to comment Wednesday.
Republicans will be leading more than half the states, so governors are going to be her main counterparts.
Some, like Rick Perry of Texas and Rick Scott of Florida, have drawn a line against helping carry out Obama's law. In other states, voters have endorsed a hard stance. Missouri voters passed a ballot measure Tuesday that would prohibit establishment of a health insurance exchange unless the Legislature approves. State-level challenges to the federal law will continue to be filed in court.
But other GOP governors have been on the fence, awaiting the outcome of the election. All eyes will be on pragmatists like Chris Christie of New Jersey and Bob McDonnell of Virginia, whose states have done considerable planning of their own to set up exchanges.
“Republican governors are at the center of the health care universe right now,” said Michael Ramlet, health policy director at the American Action Forum, a center-right think tank. “They do not have a uniform position across the board.”
GOP governors are pressing Sebelius on whether the administration will approve partial, less costly Medicaid expansions. There has been no ruling yet.
On health insurance exchanges, some governors whose states aren't likely to be completely ready are considering the administration’s offer of running the new markets through a partnership.
“The real question for Republican governors is, ‘Are you going to let the feds come into your state?’” Ramlet said. “The question for the Obama administration is whether they are going to have more flexibility.”
Major regulations due shortly and covering issues including exchange operations, benefits and protections for people with pre-existing health problems could signal the administration’s willingness to compromise.
A recent check by The Associated Press found 16 states and the District of Columbia on track to setting up their own exchanges, while nine have decided they will not do so. The federal government could end up running the new markets in half or more of the states.
As far as Medicaid, 11 states and the District of Columbia have indicated they will expand their programs, while six have said they will not. That leaves more than 30 states undecided.
On Capitol Hill, Republicans say if a budget deal is going to include tax increases, it must also come with cuts to the health care law, or money-saving delays in its implementation.
While major changes can’t be ruled out, they don’t seem very likely to former Senate Majority Leader Tom Daschle, D-S.D., who is close to the administration.
“I think Democrats are increasingly emboldened about the health care act,” Daschle said. “The president won re-election partly by defending it. There is a new dynamic around the health care effort.”
Republican attempts to amend the law will continue, he added, but outright repeal is no longer a possibility. “Budgetary issues will continue to be a big question mark,” said Daschle.
Obama's Win Means His Healthcare Law Will Insure All Americans
By Noam N. Levey Los Angeles Times November 8, 2012
President Obama’s victory all but assures that his landmark healthcare law and its guarantee of insurance coverage for all Americans will be implemented, essentially putting an end to the Republican campaign to derail the law.
Starting in 2014, millions of Americans should be able to get health insurance for the first time. Millions more who don’t get coverage through work should be able to buy a health plan that meets new basic standards.
...Tuesday’s results also present Obama with a new set of challenges as he tries to fulfill the promise of his signature legislative achievement, the biggest expansion of the social safety net since Medicare and Medicaid were created in 1965.
Federal and state officials nationwide must create systems to handle millions of new insurance customers. Key will setting up insurance marketplaces, known as exchanges, in every state by next October.
And Obama will face renewed pressure to scale back the law as Congress tries to rein in federal budget deficits.
The act authorizes more than $1 trillion in new federal spending over the next decade. Although that is offset with new taxes and other spending cuts, critics say the law’s program to provide insurance subsidies to households making up to four times the federal poverty level - or about $90,000 for a family of four - is overly generous.
At the same time, health insurance companies, hospitals, employers and other interest groups are gearing up lobbying campaigns to modify the law, parts of which threaten to push up healthcare costs.
Also unclear is how the administration will contend with GOP governors who continue to resist the law and may spurn hundreds of billions of federal dollars to provide insurance coverage.
Several states, including Texas, Florida and Louisiana, have indicated they will not open their Medicaid programs in 2014 to cover all low-income citizens. Most states - including those with Republican statehouses - are expected to expand Medicaid because the law provides hundreds of billions of dollars in federal money.
The president could face even more resistance to the law if insurance premiums and other medical costs continue to rise in coming years, undermining a pledge he made in pushing for reform.
...Obama in the past has signaled willingness to modify the law. But he has flatly rejected any major retrenchments. As the presidential campaign drew to a close, Obama increasingly defended the law. He was introduced at one of his final rallies by a father whose 8-year-old daughter got treatment for leukemia thanks to the law, an anecdote he repeated in his victory speech.
Administration officials also insist they will not delay the law, which will allow Americans who don’t get coverage through work to buy insurance on Internet-based marketplaces called exchanges. “Consumers in all 50 states will absolutely have access to an exchange come January of 2014,” said Department of Health and Human Services spokeswoman Erin Shields Britt.
Under the law, states have until Nov. 16 to tell the department whether they will set up an exchange, a complicated project requiring new data systems, regulations and bureaucracy.
Just 15 states, including California, Maryland and Connecticut, as well as the District of Columbia, have established an exchange, according to the nonpartisan Kaiser Family Foundation. More than a third of the states are expected to reject that option, forcing the federal government to step in.
There has been much hand-wringing among state officials and others over the slow process of writing regulations outlining how these federal exchanges will work. But several experts said it’s highly likely the Obama administration would be ready to open exchanges next fall.
Heather Howard, who directs the State Health Reform Assistance Network at Princeton University, cited Washington’s recent experience creating the popular Medicare Part D prescription drug program.
More uncertain is what smaller modifications the Obama administration may agree to make.
Insurance companies have been warning that a new tax on insurers - scheduled for 2014 - will be passed on to consumers, further inflating healthcare costs. Many insurers also warn that regulations limiting how much more insurers can charge older consumers could mean much higher rates for young people.
Many hospitals, meanwhile, are worried they could be saddled with more uninsured patients as states with conservative leaders decline to extend Medicaid coverage.
And employers are stepping up warnings that the law’s mandate requiring them to provide health benefits to full-time employees may prompt some to shift more workers to part-time, depressing employment.
Adjusting the law has been all but impossible over the last 2 1/2 years as Republicans pledged to destroy the legislation, fueling Democratic resistance to acknowledging emerging problems.
Those political dynamics may shift in Obama’s second term as implementation becomes an accepted reality, said Neil Trautwein, vice president of the National Retail Federation, many of whose members have been ardent opponents of the law.
“What gives me hope now is that so long as the Affordable Care Act remains the law of the land, I think Republicans and Democrats alike will have an interest in preventing any harmful effects on the economy,” he said.
Business In The Obama Era: Healthcare
By Tom Gara Wall Street Journal November 7, 2012
From the WSJ’s Jon Kamp:
Hospital stocks surged while big health insurers slumped following President Barack Obama’s re-election, which solidified the future of a complex health-care overhaul law that promises a mix of coverage-expanding benefits and new pressure points for health companies.
The health sector still faces plenty of questions as the law is implemented in coming years, and the political tussle over federal spending challenges companies with strong tethers to Medicare spending. Still, similar to June’s Supreme Court ruling, which largely upheld the health law, the election clears away a big source of uncertainty by removing the chance for repeal under a Republican administration.
While President Obama’s health care reforms will have consequences good and bad for the industry, hospital operators are notable beneficiaries, he writes:
Hospital stocks in particular have received a bounce from Mr. Obama’s re-election. Companies such as HCA Holdings Inc. (HCA) are expected to benefit as around 30 million Americans gain insurance coverage starting in 2014, which should lessen the burden hospitals bear from patients who can’t pay their bills. HCA–the biggest for-profit hospital firm, which Goldman Sachs upgraded to buy from neutral–surged 6% to $32.78 in early trading Wednesday. Among other companies, Health Management Associates Inc. (HMA), jumped 9% to $8.40, and Community Health Systems Inc. (CYH) gained 5.6% to $30.30.
While hospitals also are facing lower Medicare payments, “the impact of reimbursement for previously ‘uncompensated care’ represents a major change and significant boost for these companies starting in 2014,” Goldman analysts said.
But which businesses in the industry could be on the wrong side of the law?
Managed-care companies are also expected to benefit by gaining millions of new customers, but this is offset by a squeeze on profit margins as key parts of the law click into place, such as a requirement to cover people with pre-existing conditions...