November 16, 2012

Obamacare delay may not help Maine

Even with the deadline extended through Dec. 14, the outgoing Republican majority may have waited too long for Maine to set up a locally controlled, Maine-specific healthcare exchange.

By Steve Mistler smistler@pressherald.com
Staff Writer

The Obama administration announced Thursday evening that it will extend by a month the deadline for states to tell the government how they will implement a key component of the president’s health care law. The deadline had been Friday.

click image to enlarge

Gov. Paul LePage, center, sent a letter to Health and Human Services Secretary Kathleen Sebelius saying the state would not create a state-run exchange because the health reform law “is a stepping stone to a single-payer system."

Andy Molloy / Staff Photographer

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Read Gov. Paul LePage's letter to HHS Secy. Kathleen Sebelius

But even with the extension to Dec. 14, it may be too late for Maine to decide to build its own online insurance market for individuals and small businesses to shop for private coverage.

Over the past two years, the outgoing Republican majority in Maine’s Legislature stalled the planning process for the state to build its own exchange.

Maine is one of 16 states that have yet to notify the Obama administration whether they planned to create a health insurance exchange mandated by Obamacare, also known as the Affordable Care Act.

The federal government will take over for states that miss the deadline to ensure that the exchanges are up and running by January 2014. States can also opt to run a partnership exchange, in which they would split responsibilities with federal officials. To go that route, states must notify the federal government by mid-February, according to the Washington Post.

The decision to extend the deadline came in response to a Wednesday letter from Virginia Gov. Robert F. McDonnell and Louisiana Gov. Bobby Jindal, signed by LePage and other governors, asking President Obama to push back the impending deadline, the Washington Post reported.

The two governors made the request on behalf of the Republican Governors Association; both have said their states will not set up an exchange.

In a letter addressed to McDonnell and Jindal, Health and Human Services Secretary Kathleen Sebelius wrote, “We’re confident Governors will have enough time to decide whether they want to establish an Exchange, work in partnership with the federal government or have a federally-facilitated Exchange in their state.”

Before the deadline was extended, Maine and the 16 other states appeared to have decided to let the feds set up their exchanges.

Gov. Paul LePage sent a letter to the Obama Administration Thursday saying Maine “is not going to assist in the implementation of this (law) in its current form.”

Legislators from both parties, on the other hand, said it is still in the state’s interest to have a role. Democrats said they hope to work with federal officials to design the exchange.

Few in Maine state government welcome federal intervention, a scenario precipitated by Republican resistance to the law and their gamble that it would fail in court or be repealed in Congress.

Concerns about a federally-established exchange center on a lack of local control and a one-size-fits-all Web marketplace that may not work effectively, particularly in rural Maine where high-speed Internet access is limited. Some also worry that a federally-established exchange would include insurance plans that don’t fit the coverage needs of Maine’s population.

The exchange also will allow individuals to find out whether they qualify for federal subsidies or Medicaid, taxpayer-funded health insurance for low-income people.

Nonetheless, a federally-run exchange looms in Maine, at least in the short-term.

“The Republican Legislature basically stuck its head in the sand and hoped the health care law would go away,” said Rep. Sharon Treat, D-Hallowell, the ranking Democrat on the Legislature’s Insurance and Finance Committee, before the deadline extension had been announced.

“We had plenty of chances to create our own exchange and manage it, but we wasted two years doing nothing. Now it’s too late.”

On Wednesday, Gov. LePage signed the letter along with 20 other Republican governors that was sent to the Obama administration requesting more time and guidance.

On Thursday, however, LePage sent a letter to Health and Human Services Secretary Kathleen Sebelius saying the state would not create a state-run exchange and saying the health reform law “is a stepping stone to a single-payer system. Maine will not be complicit in the degradation of our nation’s premier health care system.”

Democrats, meanwhile, will take over majority control of the Legislature in January and said they hope a federally-run exchange is temporary.

It’s unclear whether the federal government will support or help subsidize future efforts to create a Maine-based exchange. It did two years ago, promising the state over $6 million to help plan and implement its own marketplace by picking insurers, health plans, staffing levels and an oversight board.

Maine was well on its way to implementing Obamacare in the summer of 2010. But the 2010 election put LePage in the governor’s office, Republicans in control of the Legislature and effectively changed the state’s path from implementation to resistance.

The administration immediately dissolved the bipartisan planning commission for the law. Shortly thereafter, newly-elected Republican Attorney General William Schneider entered Maine into the multi-state lawsuit challenging the constitutionality of the health care law’s lynchpin provision, the individual mandate.

State officials awaited a U.S. Supreme Court decision on the lawsuit.

Nonetheless, planning for the law’s implementation continued, albeit slowly, in case the law was upheld.

In 2011, LePage created an advisory committee comprised of insurers and hospitals to explore how to create the exchange. The committee unanimously recommended that the state create its own.

“The biggest concern is that you lose control over the exchange,” Joe Bruno, a former Republican lawmaker who became chairman of the advisory committee, said Thursday. “With a federally-run exchange you don’t know what plans are going to be in it. You could end up with something cookie-cutter that just doesn’t fit here.”

The advisory committee’s recommendation was supposed to become legislation to green-light the exchange. But as the U.S. Supreme Court decision on the law approached, Republican lawmakers balked. The state spent $1 million on planning the exchange, but turned down another $5.8 million in federal money to move forward and implement it.

Sen. Rodney Whittemore, R-Somerset, told the Press Herald in March, “Seeing how the state of Maine is opposed to Obamacare, we felt it was a bit hypocritical to move forward with an exchange at this time.”

Business leaders, including the Maine State Chamber of Commerce, called the decision a missed opportunity. Republicans countered that they saw no need to spend money implementing a law that could be struck down.

When the U.S. Supreme Court ruled the law constitutional, Republicans in Maine and many other states still declined to make a decision. Hopes shifted from the court to presidential hopeful Mitt Romney, who vowed to repeal Obamacare if elected.

Rep. Kenneth Fredette, R-Newport, the incoming House minority leader, said that a federally-run exchange is not in the state’s best interest, but that it did not make sense for lawmakers to revisit the exchange issue after the court ruling. Moving forward, however, he said it is important that Maine have a say.

Democratic lawmakers have submitted legislation that would give the state some say about the design of a federal exchange, but it’s unclear how or when it will take effect, or whether LePage will support such a bill.

Treat, the Democratic lawmaker, said she’s hopeful the federal government and the state can at least work together to create an exchange that works here.

“Nobody wants to wait for Jan. 1, 2014, to come around and discover people can’t buy health insurance,” Treat said.

Staff Writer Steve Mistler can be contacted at 791-6345 or at:

smistler@pressherald.com

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