As expected, Gov. John Kasich informed the U.S. Department of Health and Human Services on Friday about Ohio’s plans regarding a health insurance exchange. The letter does some bragging (largely justified) about progress in restructuring health care. It also recaps the administration’s complaints against the health-exchange mandate, which are consistent with its well-documented dislike of the whole health-care law.
What does surprise, even for the governor, is the bluster. The letter and a fact sheet on the health exchange go to great lengths to play up the role of defying the big, bad “Obamacare.” Yet while it screams “Ohio will not run an Obamacare health exchange,” the letter signals the state is leaving the door open to work alongside the federal government on the insurance marketplace (an option offered in the regulations). The state leaves itself wiggle room, reserving at this time “the right to amend its intentions.”
Remember that the exchange is to organize and operate a state online system for private insurers to sell their products at affordable prices for underinsured or uninsured individuals and small businesses. The first preference of the law is that states themselves create and manage the system, with startup funds from the federal government. Or a state could partner with the feds, the state taking up some of the functions in the exchange. Only if a state doesn’t do either would the federal government assume the responsibility on its own. The choice is up to states, the final deadline to submit a blueprint set for February.
The governor’s letter insists Ohio will not let the federal government take over any regulatory control of its insurance industry or decision-making on Medicaid eligibility. Ohio doesn’t need to worry. Under the regulations, plan management and eligibility decisions for Medicaid and the State Children’s Insurance Program are among key functions Ohio can retain in a hybrid exchange, a partnership with the feds. Besides, the only way the federal government will “take over” any part of the state’s insurance roles is if the governor keeps Ohio completely on the sideline in designing and managing the exchange.
Without question, structuring and operating a new marketplace is work in motion, long-term and with uncertainty. The trouble is, many conservatives have worked so hard to demonize the reform law that it amounts to losing face to take a practical step to collaborate with the feds to ensure Ohioans who otherwise would not have a prayer of affordable coverage can get it.