Seeking to appease disgruntled governors, President Obama announced Monday that he supported amending the 2010 health care law to allow states to opt out of its most burdensome requirements three years earlier than currently permitted.
In remarks to the National Governors Association, Mr. Obama said he backed legislation that would enable states to request federal permission to withdraw from the law’s mandates in 2014 rather than in 2017 as long as they could prove that they could find other ways to cover as many people as the original law would and at the same cost. The earlier date is when many of the act’s central provisions take effect, including requirements that most individuals obtain health insurance and that employers of a certain size offer coverage to workers or pay a penalty.
“I think that’s a reasonable proposal; I support it,” Mr. Obama told the governors, who were gathered in the State Dining Room of the White House.
“It will give you flexibility more quickly while still guaranteeing the American people reform.”
Kate Pickert at Swampland at Time:
As I wrote in November, there’s no guarantee Republicans governors will embrace this 2014 opt-out waiver plan, which would have to pass through Congress to become law:
Aside from the political implications of endorsing a plan championed by a Democratic leader on health reform – even if he is in cahoots with a Republican from a blue state – some on the right might balk at the Wyden-Brown plan on the grounds that it’s still an expensive expansion of government. The Wyden-Brown plan, after all, does not – as far as I can tell – spend any less money than the ACA without a state opt-out. On the contrary, it may cost more.
The Wyden-Brown plan also does not impact the huge Medicaid expansion called for in the ACA, which Republicans vehemently oppose. It doesn’t eliminate taxes on expensive health insurance plans, or fees levied on medical devices or pharmaceuticals.
Another catch: The Wyden-Brown plan only allows states to opt out if they have a good plan for how to undertake comprehensive health care reform on their own. Most states don’t have such a plan. Massachusetts, which enacted reform in 2007, obviously does, which is why Brown was a logical co-sponsor of the opt-out bill. California, Connecticut and Vermont are three other states that are on their way toward developing health care reform inside their borders. But red states – especially southern states – are among those least equipped to design and implement reform that could accomplish what the ACA attempts to do, as they typically have higher percentages of uninsured residents and looser insurance regulation.
Conn Carroll at Heritage:
As long as the HHS Secretary, whether it is Kathleen Sebelius or the next occupant of the office, has the final say on granting Obamacare waivers, then there is no real flexibility for states under Obamacare. All 50 of them would still be at the mercy of the whim of the HHS. The only real way to give states true flexibility on health care reform begins with the full repeal of Obamacare.
UPDATE: Politico confirms that Wyden-Brown has nothing to do with offering Obamacare critical states “flexibility” and everything to do with advancing single payer health care:
[A] White House conference call with liberal allies this morning says the Administration is presenting it to Democrats as an opportunity to offer more expansive health care plans than the one Congress passed.
Health care advisers Nancy-Ann DeParle and Stephanie Cutter stressed on the off-record call that the rule change would allow states to implement single-payer health care plans — as Vermont seeks to — and true government-run plans, like Connecticut’s Sustinet.
The source on the call summarizes the officials’ point — which is not one the Administration has sought to make publically — as casting the new “flexibility” language as an opportunity to try more progressive, not less expansive, approaches on the state level.
“They are trying to split the baby here: on one hand tell supporters this is good for their pet issues, versus a message for the general public that the POTUS is responding to what he is hearing and that he is being sensible,” the source emails.
The question is whether this makes Wyden-Brown more or less likely to pass. I’m guessing less likely. The political theory behind Wyden-Brown was that it gave Republicans a constructive way to attack the Affordable Care Act: The waiver program could be sold as a critique of the law — “it’s such a bad bill that states need to write their own policy” — even as it entrenched the country’s basic commitment to universal health-care insurance. You could’ve imagined it being attached to the budget or one of the spending bills as part of a larger bargain.
But now that Obama has admitted it’s not a threat to the Affordable Care Act, a lot of the appeal for Republicans dissipates. Supporting it could even be seen as helping the White House in its efforts to defend the law against repeal. So the idea looks likelier to become a talking point for the administration — see how reasonable we’re being? — than an outlet for Republicans. But perhaps that doesn’t matter: Wyden-Brown hasn’t attracted any Republican co-sponsors beyond Scott Brown, so maybe it never had a chance of playing its intended part anyway.
I suspect this is not as big a deal as it seems. Basically, Obama is calling the bluff of Republicans who insist that they can build a healthcare system that’s as extensive and affordable as PPACA using some combination of tea party-approved “free market” principles. He’s telling them to put their money (or, rather, money from the feds) where their mouths are, which will probably demonstrate fairly conclusively that they can’t do it. It’s possible that a state like Oregon might enact a more liberal plan that meets PPACA standards, but I doubt that Alabama or Tennessee can do it just with HSAs and high-deductible health plans.
Still, we’ll see. This is a chance for conservatives to show that they have a better healthcare answer in the real world, not just as talking points at a tea party rally. Obama is betting they’ll fail, and he’s also betting they’ll tear each other apart arguing over details while they do it. Life is easy when all you have to do is yell “Repeal Obamacare!” but it gets a lot harder when you have to produce an actual plan.