Sequels to ObamaCare: ScottCare, ShumlinCare and More Take Stage

Sequels to ObamaCare: ScottCare, ShumlinCare and More Take Stage

As states implement the federal health care law, three new governors are carrying out bold health reforms of their own -- and possibly setting a template for similar decisions across the nation.

National momentum to overturn the Patient Protection and Affordable Care Act may be at its lowest ebb since the law was passed last year.

Taken together, it’s a tough climate for opponents of PPACA.

But it also affirms that the action on the law is in the states, where officials are getting a chance to shape health reform in ways that President Obama could or would not.

Here are three states where new governors are making major decisions that either advance or break with the new federal law.

1.) Vermont Tries To Climb Mountain of Single Payer

Rather than simply carry out national health reforms, Vermont is on the verge of enacting a far-reaching plan to adopt a single-payer health care system.

A fast-moving bill before Democratic Gov. Peter Shumlin would create a state health insurance exchange as required under the federal health reform law, establish a publicly financed single-payer system and allow enrollees to purchase supplemental private insurance policies. Shumlin advocated for such a system during his election campaign in 2010 and has indicated that he will sign the legislation.

According to Kevin Outterson — an associate professor at Boston University and writer for The Incidental Economist — the state’s single-payer plan has attracted some powerful champions. BlueCross BlueShield of Vermont, which is the state’s largest insurer, is backing the proposal in hopes of taking responsibility for the new payment system. The Vermont Medical Association and Vermont hospitals also support the measure, Outterson adds.

Vermont already is perceived as having good public health care — Commonwealth Fund ranks the state among the nation’s 10 best performers with respect to health care access — and the bill would help cover the nearly 50,000 state residents who lack insurance.

Many states have considered single-payer models, although hesitated to make the move; California has flirted with enacting legislation several times before. So officials across the nation will be watching Vermont’s plan closely — and with particular interest on whether the model will hold down costs.

The bill doesn’t offer details on how the framework will be funded, although Outterson notes that Vermont would deploy a version of the federal Independent Payment Advisory Board with “incredible power” to control spending. Vermont also plans to ask for federal waivers that would create flexibility around its Medicaid spending and, unusually, its Medicare population, too.

2.) After Accepting Grant, Oklahoma Soon Decides To Go It Alone

At the other end of the spectrum, Oklahoma is making moves to reject the overhaul and limit the state’s participation in administering health care.

Gov. Mary Fallin (R) last month announced that her state would return a $54.6 million HHS Early Innovator Grant, intended to help create an information technology infrastructure for the health insurance exchanges mandated under the health reform law.

Oklahoma officials instead say they will use funds from state and private resources to create a “private enterprise network” that is designed to use a free-market approach to purchasing health insurance. The network will be governed by members of the private sector and chaired by the State Insurance Commissioner John Doak.

Fallin’s move speaks to many GOP governors’ fears that the reform law is an unfunded mandate — and that states will end up holding the bag. By returning the grant, Oklahoma is moving toward a “defensive strategy” against the federal overhaul that encourages free-market principles and will better use the power of the private sector, GOP State Senate President Pro Tempore Brian Bingman said.

3.) Florida Shines Light on HMO Model for Medicaid

Florida Gov. Rick Scott (R) also remains a leading opponent of federal health reforms, after emerging in March 2009 as an early critic of Democrats’ health reform legislation. Like Oklahoma, Florida has rejected several federal grants intended to speed the law’s implementation since Scott took office.

But that doesn’t mean Scott is averse to all health reform. His state is ready to make a transformative change to its $21 billion Medicaid program.

Scott is backing a compromise bill (HB 7107, SB 1972) that would shift nearly three million state Medicaid beneficiaries to managed care plans beginning in 2012. The measure would allow Florida to decide how much to spend annually on Medicaid and to share in the profits of managed care companies if they are greater than 5%.

The bill would eliminate the current fee-for-service system, and the state and managed care companies would determine which services would be covered. Beneficiaries would pay $10 monthly premiums and would be charged $100 if they visit an emergency department for nonemergency care.

As with Vermont’s single-payer experiment, other states will be closely watching to see if Florida’s measure tamps down its health spending. According to Scott, the changes would save his state $1.1 billion within the first year.

However, Florida still needs federal waivers to carry out the overhaul’s provisions and it is unclear whether CMS will back the changes. The agency last month sent a letter to Florida lawmakers saying that the federal government will withhold approval until it receives more state details on the initiative. CMS also said that Florida must mandate that participating managed care plans abide by new medical-loss ratios, where they spend a certain percentage of money they receive on patient care.

Of course, there’s at least one other state where a new governor has assumed a pivotal role in health care reform: California. An upcoming “Road to Reform” will go deeper on how the overhaul is playing out in the Golden State. Meanwhile, here’s a look at what else is making news around the nation.

Rolling Out the Reform Law

On the Hill

In the States

In the Courts

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