(Bloomberg) — As congressional Republicans meet this week to gut Barack Obama’s signature health care law, they can look for guidance to Kentucky, where a big political promise met with reality to force the type of compromise national lawmakers might face.
The result: a taxpayer-funded insurance program that looks a lot like Obamacare.
President Donald Trump, who vowed to kill the Affordable Care Act as one of his first moves, signed an executive order Friday declaring that his administration will seek the “prompt repeal” of the law and that the government should prepare to “afford the states more flexibility and control to create a more free and open healthcare market.” No specifics were provided.
Kentucky Republican Matt Bevin ran for governor on a platform devoted almost exclusively to killing Obamacare, including its expansion of Medicaid insurance to the poor. He didn’t do it. Following in the steps of eight Republican governors who sought to expand Medicaid without appearing to do so, he applied for federal permission to add Republican-friendly tweaks to the program instead.
The decision was a nod to reality. By the time Bevin took office at the beginning of 2016, almost one in three Kentuckians had Medicaid or insurance through a federally subsidized Affordable Care Act plan. Many of them didn’t know it when they elected the new anti-Obamacare governor, a side effect of how Kentucky marketed the plans.
Kentucky pushed Obamacare as anything but Obamacare in order to sidestep political hostility to the president, whose position on coal made him unpopular in a state with roughly half the coal jobs it had in 2010. Enrollees signed up for Kynect, the state’s brand of the health-law insurance, not Obamacare. Medicaid recipients enrolled through managed-care companies that handle the program, including Louisville, Kentucky-based Passport Health Plan.
“A lot of people, they just know they have insurance but they don’t know it’s Obamacare,” said Amber Lewis, 34, who sells guns, Kennedy half dollars, baseball cards and knives every day at a booth at the Bull Creek Trade Center in Prestonburg, Kentucky.
“They say they have Kynect insurance, or Passport insurance, I hear it both ways,” said Lewis, who has insurance for the first time, pays nothing for it and knows what it is. “I know what I have. I have Obamacare.”
Starting in 2013 when Kentucky’s then-Democratic governor embraced Obamacare, Cara Stewart, a health law fellow at the Kentucky Equal Justice Center, along with the state’s Primary Care Association and others, enrolled hundreds of people in the program without mentioning Obamacare, the Affordable Care Act or the federal government.
Uninsured rate plummets
Within two years, the state’s uninsured rate had fallen to 6 percent of the population from 20 percent. More than 420,000 people had been insured through Medicaid expansion, dropping the number of uninsured in some low-income jobs — at restaurants, construction sites, gas stations and discount stores, among others — by between 35 percent and 52 percent, according to data from the Kentucky Center for Economic Policy, which studies impacts on the poor.
It had been easy for Bevin to run against Obamacare. Once in office, his promise meant killing the subsidized insurance much of the state depended on but didn’t know they had.
He turned to a consulting company then led by Seema Verma, now the head of the U.S. Centers for Medicare & Medicaid under Trump.
Verma was also a health policy adviser to Vice President Mike Pence when he was governor of Indiana.
Premiums and punishments
Instead of scrapping Kentucky’s expanded Medicaid, Bevin applied for the same kind of federal waiver won by other Republican governors, led by Pence. The waiver programs include Republican-looking add-ons — premiums, punishments, so-called skin in the game for the poor — that allowed the governors to expand Medicaid under Obamacare, while saying they were doing something else.