The focus in Washington these days is on whether the government will be ready for the start of Obamacare.
Although the coverage itself doesn't begin until Jan. 1, the "open season" to begin purchasing subsidized insurance starts Oct. 1. That means states that have chosen to run their own health insurance exchanges need to be ready to "go live" on Oct. 1. The same is true for the federal government, where it has assumed responsibility for running exchanges for the majority of states that have chosen not to run their own exchanges. Not surprisingly, the question has been raised regarding what happens if they are not ready.
Readiness of the Federal Exchanges
Much to the Administration's surprise (and consternation), 34 states have decided to rely on the federal government to run their exchanges for them—at least for this first year. Given this broad reliance on the federal government's exchanges, the report issued by the Government Accountability Office (GAO) in late June that the federal exchanges are behind schedule must have caused substantial disappointment among ACA supporters.
According to the GAO, both the development and the testing of the computer systems that will determine eligibility for government subsidies and the training for the people who will help individuals seeking coverage are behind schedule—giving critics reason to question whether the federal systems will work as promised and whether they will be able to handle the volume of on-line traffic that could result. At least some of the delay was attributed to the "still-evolving scope of CMS-required activities in each state." The plans to train the so-called “navigators” who will help the newly insured choose insurance are also running about two months behind schedule. Despite the GAO report and the daunting amount of work that seems to remain to be done, the Administration continues to assert that the exchanges will open on schedule Oct. 1.
Readiness of the State Exchanges
The 16 states that are running their own exchanges are reportedly in various states of readiness—how ready will become clear on Oct. 1, as well. Some of the variation depends on how early the states embraced the concept of establishing their own state exchange as well as how much prior experience they had in performing some of the technical tasks that needed to be accomplished.
Maryland, for example, was an early adopter of a state-based exchange. Legislation establishing the exchange was signed into law in April 2011, before the U.S. Supreme Court gave its ruling on the constitutionality of the legislation and Maryland's exchange, called the Maryland Health Connection. The exchange, which was among the first six approved by the federal government last December, launched a website in August 2012 that has been reporting on progress toward readiness for the exchange’s Oct. 1 debut. It also has established a call center to provide phone support for individuals, employees, and small employers.
The District of Columbia is another early adopter of the concept of a state exchange, but it has not had as much time as Maryland to test its procedures. The District of Columbia appointed an implementation committee in May of 2011, but the actual law creating an exchange authority was not signed until January of 2012. The exchange also received federal approval last December. Its most contentious decision has been to require small employers to use the exchange because of concerns of inadequate volume to sustain the exchange without small employer participation.
Variations in Promotional Efforts
Variations in the amounts that states are spending on promoting the Affordable Care Act (ACA) are consistent with the split between those states that support the ACA and have generally adopted their own exchanges and the rest of the states that have either resisted the ACA and/or are relying on the federal exchanges to take the blame for any initial-year snafus. Maryland is spending $5.47 per capita to promote the ACA and the increased availability of insurance through the exchange, while neighboring Virginia, whose governor opposed the ACA and ultimately chose to rely on a federal insurance exchange, is spending $0.49 per capita. A similar contrast exists between Missouri and Colorado. Missouri, which has resisted the ACA and is relying on a federal exchange, is spending $0.71 per capita, while Colorado, whose governor has been supportive of the ACA, is spending $4.23 per capita.
In addition to spending money, some states have reached out to media and star athletes to support the coming availability of subsidized insurance, while others have made little to no effort to promote awareness of the increased availability of coverage.
Implications for the ACA
By all indications, the ACA will have a rocky and bumpy start in 2014—but rocky and bumpy should not be confused with cataclysmic. The legislation is highly complex, and many provisions have had to be delayed. Much attention has been given to the one-year delay in the start of the employer mandate, but not much attention has been given to the one-year delay in the out-of-pocket cost limits for individuals and families. A small amount of attention has been given to the one-year delay in the verification of an individual's attestation regarding exchange eligibility. With this latter delay, it's not hard to imagine many anecdotal stories of fraudulent eligibility being a part of the 2016 presidential election.
But none of these issues should be regarded as reason for the opponents of the ACA to cheer. Even the low approval ratings currently being reported—with as many as 52 percent of Americans being opposed to the law—doesn't increase the likelihood of the law being repealed or fundamentally changed. The reelection of a Democratic Senate and president in 2012 meant that the major provisions of the ACA—the subsidized purchase of private insurance by those below 400 percent of the poverty line who don’t have employer-sponsored insurance offered to them and the expansion of Medicaid in states that have chosen to do so—will proceed as scheduled. And once in place, the act’s removal is almost impossible to imagine. At least I know of no precedent to support the notion that an entitlement might be removed after it has been put in place.
As hard as it will be for some Republicans to accept, after the 2014 election has ended and we either continue with a split Congress or perhaps see a Republican Senate and continue with split government, the time will come when the focus should be on how to improve the ACA—the law of the land.
Gail R. Wilensky, PhD, is a senior fellow at Project HOPE; a former administrator of HCFA, now the Centers for Medicare & Medicaid Services; and a former chair of the Medicare Payment Advisory Commission.
Publication Date: Sunday, September 01, 2013