Health & Human Services

The Increasing Opposition to the New Health-Care Law

Attorneys general in several states are seeking to overturn the federal health-care law.
by | January 2011

Following the Republican sweep in November’s elections, opposition to the new federal health-care law has become even more intense among state officials. But that doesn’t mean they’ll succeed in doing much to stop or seriously slow its implementation.

That may seem surprising. Attorneys general in several states ran explicitly on the pledge to join the multistate lawsuit seeking to overturn the law. Numerous governors and legislators, meanwhile, vowed to “repeal and replace” it. There’s even been bold talk in some states -- notably Texas -- about backing out of the Medicaid program altogether.

Last month, a federal judge in Virginia threw out the mandate that individuals buy insurance. But that decision will be appealed, and unless the entire law is successfully blocked in court or repealed -- something that won’t happen until President Barack Obama is out of the White House, at least -- states will have strong financial incentives and political pressures to participate. Consider the exchanges: These are online marketplaces where individuals and small businesses will sign up for insurance coverage, and where eligibility for assistance programs, including Medicaid, will be determined. If states don’t set up their own exchanges, the feds will do it for them.

Politicians will feel pressure from insurance companies and other players within their states not to allow the feds to run the exchange.

All but two states have signed up for federal grants to help design exchanges. “To opt out of the exchange could potentially mean a loss of Medicaid dollars -- not just the new expansion, but existing Medicaid dollars,” says Sandy Praeger, insurance commissioner for Kansas. “Even the conservative governors, like ours, would want to retain control of that.”

It really does come down to dollars. State officials have railed mightily against the administrative costs associated with implementing the law. And they’re certainly nervous that federal funding for newly eligible Medicaid recipients and other populations won’t be as generous as promised.

But the law does offer billions to states. “The reality is that there’s an enormous amount of resources,” says Trish Riley, director of the governor’s Office of Health Policy and Finance.

Baldacci’s replacement, Paul LePage, is one of the most fervent gubernatorial opponents of the law. Riley concedes that the level of opposition is going to vary from state to state. Some states will be searching for tools they can use, while others will fight the new law “to the death,” she says.

Still, it doesn’t look as if political opposition -- or hot rhetoric -- will lead states to opt out entirely. They will continue their legal challenges, while lobbying Congress to change things such as Medicaid funding levels and the mandate for individuals to purchase insurance.

However, they will mostly be preparing for the law’s true start date in 2014. “The only thing we can say with any confidence is that there’s a lot of activity to implement this at the state level,” says Alan Weil, executive director of the National Academy for State Health Policy, “even as there’s opposition politically.”

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