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Regulation and Compliance > State Regulation

State PPACA Efforts Vary

By RICARDO ALONSO-ZALDIVAR, Associated Press

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WASHINGTON (AP) —This is the year that will make or break the Patient Protection and Affordable Care Act of 2010 (PPACA).

States will either move forward with implementing major health insurance changes that are supposed to take effect in 2014, or the changes will take place late or won’t happen at all.

PPACA calls for states to help set up health insurance distribution exchanges by Jan. 1, 2014. The exchanges are supposed to help individuals and small businesses use new tax subsidies to buy health plans that meet federal actuarial value and quality standards.

State exchange implementation plans are due at the U.S. Department of Health and Human Services (HHS) Jan. 1, 2013. If a state fails to set up an exchange program on time, Washington is supposed to step in and supply exchange services for the state’s residents.

The Obama administration says states are making steady progress at implementation, but an analysis by The Associated Press shows that the status of implementation efforts varies widely from state to state.

WHO’S DONE WHAT

The AP’s analysis divided states into four broad groups: Those that have adopted a plan for exchanges, those that made substantial progress, those where the outlook is unclear, and those with no significant progress. AP statehouse reporters were consulted in cases of conflicting information.

Thirteen states, plus the District of Columbia, have adopted an implementation plan.

In 20 states either the outlook is unclear or there has been no significant progress. Those states include more than 21 million of the 50 million uninsured Americans.

Four states — Arkansas, Florida, Louisiana and New Hampshire — have made no significant progress. The last three returned planning money to the federal government. In Arkansas, Democratic Gov. Mike Beebe ran into GOP opposition in the Legislature. Beebe acknowledges that the federal government will have to run the exchange for his state, but he is exploring a fallback option.

In the other 16 states, the outlook is unclear because of failures to advance legislation or because of paralyzing political disputes that often pit Republicans fervently opposed to “Obamacare” against other Republicans.

In Kansas, for example, Sandy Praeger, the insurance commissioner, is pushing hard for the development of a state exchange. But Gov. Sam Brownback returned a $31 million federal exchange implementation grant, saying the state would not act on implementing an exchange program before the Supreme Court rules on PPACA’s constitutionality. Both officials are Republicans.

“It’s just presidential politics,” said Praeger, discussing the situation nationally. “It’s less about whether exchanges make sense and more about trying to repeal the whole law.”

Another 17 states have made substantial progress with developing an exchange system implementation plan but do not yet have a plan. Last week in one of those states, Wisconsin, Gov. Scott Walker, R, abruptly halted exchange planning efforts and announced he will return $38 million in federal money.

AP made up a list of states in which governors or legislatures have made significant commitments to setting up exchanges, and in which the states have accepted federal exchange establishment grants. The states on the list include many with Democratic governors, such as New York.

The list of states that have made substantial progress also includes some — such as Arizona, Indiana, New Jersey, New Mexico and Virginia — that have Republican governors.

STATES AND FEDS

The Obama administration said the differences in state exchange implementation efforts should not affect consumers.

“The fact of states moving at different rates does not create disparities for a particular state’s uninsured population,” said Steve Larsen, director of the Center for Consumer Information and Insurance Oversight (CCIIO) at the U.S. Department of Health and Human Services (HHS).

Larsen says the federal government will be ready to provide exchange services for the residents of the states that are unable or unwilling to do so.

But whatever agency takes charge has a big job ahead of it.

The exchange creators must set up secure systems that can verify income, legal residency and other personal information, then enroll users in private insurance plans or Medicaid.

“It’s a very heavy lift,” said California’s health secretary, Diana Dooley, whose state was one of the first to approve an exchange implementation plan.

Meanwhile, about half of the states are trying to get the Supreme Court to declare PPACA to be unconstitutional.

In states where Republicans are fighting PPACA tooth and nail, there’s little incentive to move ahead with exchange implementation before the Supreme Court rules. A decision is expected this summer. Many state legislatures aren’t scheduled to meet past late spring.

If the Supreme Court upholds PPACA, and some states have failed to develop exchange implementation plans, the federal government could end up with much greater sway over the health care systems in those states.

“If you give states the opportunity to decide their own destiny, and some choose to ignore it for partisan reasons, they almost make the case against themselves for more federal intervention,” said Sen. Ben Nelson, D-Neb.

When PPACA was being drafted, Nelson was on the winning side of a heated argument among Democrats over who should run exchanges — the federal government or the states. Nelson wanted the states to run the exchanges. Others, generally viewed as being more liberal, wanted the exchange system to be run by the federal government and insulated from state politics.

Nelson said he regrets the concession he fought for has been dismissed by so many states.

“It’s pretty hard to take care of the states when they don’t take care of themselves,” Nelson said.

DOWN IN TEXAS

For uninsured people living in states that have done little, the situation is demoralizing.

“It’s not that we want something for free, but we want something we can afford,” said Vicki McCuistion of Driftwood, Texas, who works two part-time jobs and is uninsured. With the nation’s highest uninsured rate, her state has made little progress.

McCuistion and her husband, Dan, are among the nearly 6.7 million Texans who lack coverage. Dan is self-employed as the owner of a specialty tree service. Vicki works part time for two nonprofit organizations. The McCuistions have been uninsured throughout their 17-year marriage, although their three daughters now have coverage through the Children’s Health Insurance Program. Dan McCuistion has been nursing a bad back for years, and it only seems to get worse.

“For me it almost feels like a ticking time bomb,” his wife said.

Dan McCuistion says he doesn’t believe Americans have a constitutional right to health care, but he would take advantage of affordable coverage if it was offered to him. He’s exasperated with Perry and other Texas politicians. “They give a lot of rhetoric toward families, but their actions don’t meet up with what they are saying,” he said.

Texas Gov. Rick Perry entered the Republican presidential primary this year.

He helped scuttle plans to advance an exchange bill in the Texas Legislature last year.

The Texas Legislature is not scheduled to meet this year, so the situation is unclear.

Lucy Nashed, a Perry representative, says Perry opposes PPACA because of principle, not because of lack of compassion.

“Gov. Perry believes ‘Obamacare’ is unconstitutional, misguided and unsustainable, and Texas, along with other states, is taking legal action to end this massive government overreach,” Nashed said. “There are no plans to implement an exchange.”

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