With deadline looming, Haslam weighs state’s role in Obamacare

Sunday, December 2, 2012 at 10:05pm
1203 Haslam exchanges main.jpg
Gov. Bill Haslam

In less than a year’s time, buying health insurance will be much like shopping for a car online, without the giddy excitement about whether to spring for a sunroof.

The new system, required by the federal government, will lay out options for the up to 900,000 uninsured Tennesseans who will need coverage to avoid financial penalties from the federal government. But it will also give small businesses a place to buy insurance and give people who are covered a place to comparison-shop their plans against their employers.

The exchange is expected to launch by October 2013, when open enrollment begins. Health insurance plans will kick in Jan. 1, 2014.

In addition to providing a website for shopping around for insurance, the exchange will determine whether buyers qualify for federal subsidies on their rates — these breaks kick in for those making up to 400 percent of the federal poverty level, or less than about $92,000 a year for a family of four.

But creating a virtual marketplace for health insurance shopping takes more than just popping up a website. It’s going to take a political and policy decision from state lawmakers before anyone can even get started putting it up.

It is a choice many Republican state lawmakers put off this year in anticipation of the U.S. Supreme Court nullifying the Patient Protection and Affordable Care Act over the summer, and in hopes that Republican nominee Mitt Romney would take out President Barack Obama in the presidential election.

Since neither of those events transpired to unravel Obamacare, state lawmakers now have a bundle of decisions to make.

Most immediate on that list is whether it will operate the health insurance marketplace, otherwise known as the “exchange.” The move could be politically twisted against GOP lawmakers, either to allege that those Republicans endorse Obamacare or are giving control to their biggest enemy: the Democrat-helmed federal government.

Thousands of Tennesseans are weighing in on the issue. Gov. Bill Haslam’s staff said they have received some 4,000 emails and 2,000 phone calls about insurance exchanges.

While the staff didn’t break down the email messages to pros and cons, almost all of the phone calls were urging the governor to say “no Obamacare in Tennessee” — a decision that is out of the state’s hands — or ditch the exchange and let the federal government handle it.

Of the rest, about 75 said they were in favor of a state exchange. Another 32 spoke out against the state running it, but changed their stance after the choices were explained, according to the governor’s constituent services staff.

Almost 30 called wanting the state to secede, and eight urged nullification of Obamacare. Six called for a civil war.

In any case, the decision on who should run the exchange is sure to have political overtones when it greets the legislature as it returns next month.

Haslam has until Dec. 14 to decide who will run the exchange. For months he has repeatedly said the state can run the program better than the federal government could, but he has shied away from committing to that route. He blamed the holdup on a lack of information from Washington, D.C., on details of how exactly the state-run exchanges and federal exchanges would work.

For example, the state would have at least some power to choose which health insurance carriers could sell on the exchange, but it’s unclear which details will be up to state officials to determine and which will be prescribed by the feds.

The same goes if the state opts to let the federal government run the exchange for Tennessee. State officials say they have no clue whether that means the state would be totally hands-off or would still have a role to play. In addition, the state could decide to partner with the federal government to run the program.

The feds handed the state $9.1 million in grants to help it do the homework to figure out whether to pursue an insurance exchange. So far, state officials say they’ve spent less than $1.5 million of it, mostly on salaries and benefits for staff researching insurance exchanges, although they say they still don’t have enough details to put forth solid recommendations.

Health insurance providers have also helped look into planning for the exchange, a function they want to see done by the state. According to a spokeswoman for Blue Cross Blue Shield of Tennessee, that’s because state officials understand the local market better than officials in Washington.

Although Democrats in the legislature largely want to see the state run the exchanges, they’re dramatically outnumbered by Republicans in both chambers — many of whom say they’d rather leave the exchanges up to the feds.

“At this point I don’t think there’s a snowball’s chance of that happening,” said Gerald McCormick, majority leader in the state House of Representatives.

“We’re not going to set up a state exchange unless we really have some detailed information on it, and it becomes favorable for the state of Tennessee to do so in a way that cannot be reversed. And I just don’t see that happening, based on past experience with the federal government,” he said.

Senate Speaker Ron Ramsey said he too is leaning toward washing his hands of the exchange, saying it’s “doomed.”

“It’s a catastrophe right now, because they can’t tell you what the rules and regulations are, even if you ask specific questions. And so I just don’t see why we need our fingerprints on this,” he said.

“I won’t disagree with that argument that the states can run it better, if it was truly, legitimately running it. But we’re not going to be running it.”

Even if the governor decides by the Dec. 14 deadline that running the exchange is the best course of action, he’ll still have the daunting task of seeking the legislature’s approval on the issue, which could face pushback from the Republican majority. With all Democrats on board, he would need 22 Republicans in the House and 10 in the Senate to break ranks with leadership.

“Ultimately, our job is to do the right thing for the state. But we also realize we have to pass it in the House and the Senate, and we have to be confident we can do that as well,” Haslam said.

“If we’re convinced at the end that’s the right thing, then it will be our job to sell that,” he said.

10 Comments on this post:

By: CrimesDown on 12/3/12 at 9:19

Please proof read your articles.

By: James Arthur on 12/3/12 at 8:20

Three cheers for Majority Leader McCormick.

22 other states have already said "no," and so should we.

2/3rds of the exchange's function is to enforce mandatory Obamacare: to collect citizens' private information, set Obamacare standards, determine eligibility based on your private information, monitor compliance, and refer violators to the IRS. The other 1/3rd is to offer and enforce federally approved policies, sold by federally approved sellers, to buyers who'd all too often rather keep what they had before.

So, it's not a happy place where people can blithely shop for insurance, and it's not a free market. It's a federal takeover. It costs more, it restricts choice, it has our own fellow citizens in Nashville reporting on us to the IRS. Tennesseeans have made it very clear: we don't want this.

If we create a "state" exchange (federally-controlled, despite the name), we lose rights, we take the feds' bait, and we wind up with all the duties of running and paying for something we won't even control.

The assurances they offer us to the contrary are as good as the virtual regulatory paper they still aren't even yet printed on--Sebelius can pull the rug out any time, at her sole discretion, leaving us with a broken system, a crushing burden, all the responsibility, and all the bills.

By defaulting to a federal exchange now we lose nothing--we can always switch later, after other states have blazed the trails, worked out the procedures, eliminated bugs, written the software, etc. That's allowed. Meanwhile the feds have to pay for it, not us. Not that we'd ever want a "state" exchange--we don't--but the option's open.

No state exchange. We don't have to create one, and we shouldn't.

By: sg1friz on 12/3/12 at 11:02

Don't these people live on freebies from the society?
Did you know that most of these people are in government to protect their money and selfish interest?
Do these people really know how it feels not to have health care insurance let alone what it means to be poor?
Aren't these people too rich to honestly care about anyone but themselves and their money?
How much money do you need to live this finite life? I know you do not want others to be cared for with your money.
How much money did you come with when you were born into life and how much money will you go to your grave with?

By: sg1friz on 12/3/12 at 11:04

Republicans think that crooks in washington deserve better health care than hard working Americans

By: treehugger7 on 12/4/12 at 7:32

Who brought the mixed nuts to this forum?

By: treehugger7 on 12/4/12 at 7:51

It makes so much more sense to have our own exchange. Since the repubs can f*** up a wet dream, we probably won't get it. Republicans need to accept that elections have consequences. Haven't I heard that somewhere before?

By: frogmild on 12/4/12 at 8:27

Haslam's comment, " “Ultimately, our job is to do the right thing for the state", is part of the problem as i believe he has severely confused just what the state is. In his and many of the political figures minds the state seems to have become the government and not the people. When the overwhelming majority of the people strongly oppose a financial boondoggle like obamacare and strongly voice that opposition, they have a right to see their decision implemented even if it is wrong, on the other hand those who ignore the people are betraying the trust placed in them to be representatives of the people. I believe Haslam has already made up his mind and will ignore the people in favor of his powerful buddies who will make fortunes off this disaster.

By: James Arthur on 12/4/12 at 9:51

@treehugger7, if you believe in gov't-controlled healthcare, why wouldn't you welcome a federal exchange? You should be delighted.

If you believe the states can do a better job, then you're disagreeing with Obamacare--it's a federal takeover. That's the whole point of it--for the feds to take over your health care, and for the IRS to make sure you do it. The exchange helps them.

Why not do whatever we want and need to do right here in TN using our own money and our own programs, NOT Obamacare? Then we could discuss it, change it, alter it however and whenever we wanted.

That's so much more efficient, so much more flexible, and so much better.

Sending our money to the feds so that they can spend it on Solyndras, then give us part of it back in a "state" exchange--under their strict, awkward, and wasteful micromanagement-- isn't cheaper, it isn't more flexible, and it's not nearly as good.

We're better off taking a federal exchange--it saves money, and preserves jobs, options, and choice.

The hospitals and insurers are seeking a bad remedy for their legitimate problems. If hospitals and insurers in TN need special consideration for uncompensated care or rural communities, etc., Obamacare isn't the solution--we should handle that here. Having Washington tax us, then send a fraction back--with their political conditions--just makes it more costly and less flexible.

No state exchange. Just say "no."

By: joe41 on 12/4/12 at 9:57

The Affordable Healthcare is here to stay. We had better get with it or it will cost us dearly. It reminds me of the patient who keeps denying that he is alcoholic until it kills him. It is the law,, it is going to happen. So make it right Tennessee. Or you will cost us all dearly!


By: NewYorker1 on 12/4/12 at 2:21

OMG!!! What am I going to wear? Fendi, Gucci, or Prada?