States given more time to work on health exchanges

WASHINGTON Fri Nov 9, 2012 6:29pm EST

Patient Joan West (R) receives a check up from Dr. Lisa Vinci at University of Chicago Medicine Primary Care Clinic in Chicago June 28, 2012. REUTERS/Jim Young

Patient Joan West (R) receives a check up from Dr. Lisa Vinci at University of Chicago Medicine Primary Care Clinic in Chicago June 28, 2012.

Credit: Reuters/Jim Young

Related Topics

U.S. Secret Service provide security for President Barack Obama in Pensacola, Florida, June 15, 2010. REUTERS/Jim Young

Protecting the President

The Secret Service detail surrounding President Obama.  Slideshow 

WASHINGTON (Reuters) - The Obama administration gave states extra time to work toward setting up new health insurance exchanges on Friday, three days after President Barack Obama's re-election ensured the survival of his healthcare reform law.

The move is seen as a concession to dozens of states that delayed compliance with the Patient Protection and Affordable Care Act until after the November 6 election. Republican governors in some states had hoped to see a victory for the party's presidential challenger Mitt Romney, who had vowed to repeal the law.

But with a November 16 deadline to declare their plans looming, many need more time to prepare for the exchanges, which are complex marketplaces designed to allow working families the chance to purchase private insurance at subsidized rates beginning in 2014.

In cases where states decide not to participate at all, the federal government says it will go in and build an exchange on its own. Since Tuesday's election, governors in seven states - including Texas, Kansas, Virginia and Florida - have said they will refuse to proceed with an exchange.

"The administration would like to do whatever it can to bring states in," said Larry Levitt, a healthcare policy expert with the nonpartisan Kaiser Family Foundation, which tracks health issues.

"It's always been expected that if the president got reelected, a lot of states sitting on the sidelines would realize they don't want the federal government building a state health insurance system. That's what we're seeing happening."

U.S. Health and Human Services Secretary Kathleen Sebelius said in a November 9 letter to governors that the administration still expects states to declare whether they intend to operate their own exchanges by next Friday. But they now have until December 14 to file blueprints showing how they would operate the marketplaces. So far, about 13 states are well on their way to setting up their own exchanges.

States can also choose to develop their exchange in partnership with the federal government, and as many as 30 could go that route.

Sebelius said states preferring a partnership now have until February 15, 2013, to declare their intentions and prepare the appropriate paperwork. She said states can still apply to run exchanges in subsequent years but emphasized that the start date for coverage has not changed.

"Consumers in all 50 states and the District of Columbia will have access to insurance through these new marketplaces on January 1, 2014, as scheduled, with no delays," she said in the letter.

The reform law, the most sweeping health legislation since the mid-1960s, would extend health coverage to more than 30 million uninsured Americans. About half would receive coverage through a planned expansion of the Medicaid program for the poor, and the other half through the exchanges.

The list of states that say they will not participate in the healthcare exchanges grew this week when Virginia and Kansas said they would not cooperate with the federal reform.

Texas, South Dakota, South Carolina, Alaska and Florida confirmed to Reuters on Friday that they will not participate in exchanges. Louisiana had also opposed the plan before the election, but officials there did not respond to inquiries about their plans under Obama's second term.

(Writing by David Morgan; Editing by Michele Gershberg, Eric Walsh and Claudia Parsons)

FILED UNDER:
We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (1)
The feds have no money to set up the exchanges themselves. The feds can not legally subsidize insurance on an exchange they have set up themselves. And it’s unsettled law whether they can penalize employers in states which have refused to set up the exchanges.

Obamacare is a mess.

Nov 09, 2012 4:42pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.