New York Takes Rhode Island Route: ACA Exchange Via Executive Order

Like Rhode Island's Gov. Lincoln Chafee, New York Gov. Andrew Cuomo stepped in after legislation stalled in the statehouse.
by | April 16, 2012

Yesterday, New York Gov. Andrew Cuomo became the second governor to issue an executive order establishing his state’s health insurance exchange, an online marketplace outlined in the Affordable Care Act (ACA).

The first was Rhode Island Gov. Lincoln Chafee, as Governing detailed in an on-going series on that state’s exchange implementation. Chafee set up his state’s exchange last September. He stepped in when an exchange bill got stuck in the state House over added language related to the state funding of abortions.

Like Chafee, Cuomo took action after exchange legislation stalled in the state legislature. According to the New York Times, Republican lawmakers had blocked consideration of the bill, both because of their general opposition to the ACA and because of the uncertainty surrounding the law until the U.S. Supreme Court rules on its constitutionality.

Cuomo’s office did not communicate with Chafee or his staff before issuing his executive order, Rhode Island officials told Governing.

Chafee is now facing litigation from an anti-abortion group and a coalition of state lawmakers. “We got bypassed,” State Sen. Harold Metts, a Democrat and one of 28 Rhode Island legislators to sponsor the lawsuit, told Governing previously. “The administration has their role, and the legislators have their role. I think [Chafee] stepped beyond his.”

(Senate President M. Theresa Paiva-Weed, a sponsor of the original exchange legislation, is expected to reintroduce a bill in the coming legislative session.)

It is unclear if Cuomo’s order could face a similar challenge. According to the Times, Senate Majority Leader Dean Skelos, a Republican, indicated earlier this month that his party wouldn’t take such action. He did add a cryptic qualifier, however. “The governor has the right to issue executive orders,” Skelos told the Times. “If somebody wants to sue him, fine.”

The order did draw criticism from some GOP legislators. "With the fundamental constitutionality of the overall looming program in immediate question and the presidency hanging in the balance there is zero need to build an initial framework for a large and expensive government program that may never get off of the ground," state Sen. Greg Ball said in a statement.

Reports from New York media did not indicate if lawmakers would still attempt to pass legislation.

According to the National Conference of State Legislatures (NCSL), 10 states have established exchanges post-ACA via passed legislation.

Under the ACA, states must demonstrate to the U.S. Department of Health and Human Services (HHS) that they can operate an exchange by Jan. 1, 2013. However, HHS has allowed for some leeway in that deadline under recently finalized rules. The online marketplaces are supposed to be open for enrollment in October 2013.

According to NCSL as of this week, another 19 states have exchange legislation pending in their statehouses. It remains to be seen whether more governors, frustrated with inaction by lawmakers, will take their own initiative.

Joy Wilson, senior health policy analyst at NCSL, said she doesn't expect a sudden surge in exchange-establishing executive orders. It is a matter of practicality: under most state systems, governors don't have enough power to oversee full implementation. Even Chafee and Cuomo, she said, will likely need the cooperation of their legislatures to finish the job.

"Most governors can do a little bit with an executive order, and then they have to come back to the legislature," Wilson said. "You're not going to see a groundswell of executive orders unless there is some agreement with the legislatures."

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