The federal government and not Arizona will run the insurance exchange required by the Affordable Care Act.
In a letter Wednesday to Health and Human Services Secretary Kathleen Sebelius, Gov. Jan Brewer said her administration had made "significant progress'' in planning and designing the exchange. It would provide a marketplace for those who make too much to qualify for Medicaid but still meet certain income standards to buy subsidized health insurance.
But Brewer said the federal government has not provided detailed regulations on a timely basis for Arizona and other states to make informed decisions on whether to provide their own state-based exchanges. She also said there have been delays in telling states when required services will be made available.
Brewer is not alone in deciding to opt out and let the feds run the program: More than a dozen other governors already have made such a choice.
The governor's decision essentially means it will be the federal government which will set up an exchange in the state. That includes which insurers will be able to sell plans to Arizona residents.
The question of who runs the insurance exchange may have little impact on the average Arizonan. There is only limited flexibility for states to affect major issues like what medical conditions are and are not covered.
But it could be an early indication of her leanings on the other big decision she needs to make within the next two months about another key provision of the federal Affordable Care Act: whether to expand eligibility of the state's Medicaid program.
Thursday's decision not to have a state-run exchange came despite lobbying by hospitals and some health insurers in favor.
Pete Wertheim, vice president of the Arizona Hospital and Healthcare Association said while the question of who operates the exchange can make a big difference to health care providers. That's because Brewer's move means that the rules for the exchange will be decided by the federal Centers for Medicare and Medicaid Services in Washington rather than locally.
"There are some unknowns still left with what a federally operated or administered exchange in a state will look like, areas like rules of participation, what types of insurance plans can join the exchange, offer products, pricing, governance,'' Wertheim said. "There are a lot of issues that if you sort of forego those at a state level, you're sort of at the mercy of CMS to see what kind of rules they're going to dictate that states will play by.''
Gubernatorial press aide Matthew Benson said his boss normally prefers to have states in charge of programs, with the feds providing the money and only general guidance. But he said Brewer concluded that was not going to be the case here.
"There is no true local control under the Affordable Care Act,'' Benson said. "Whether we leave the exchange to the federal government or run it as a state, the reality is most of the decision making and authority would be left to the federal government.''
Benson said the governor, who already spent about $10 million in federal funds working to design a state-run exchange, did listen to the concerns of hospitals, insurance companies and patient advocacy groups. In the end, though, he said none of that alleviated her concerns.
One is that "lack of true authority'' Arizona would have in setting up and operating the exchange. But Benson said Brewer also was worried that it would fall to the state to construct and operate the exchange. Opting out means the financial burden falls on Washington.
And equally important, Benson said, was the fact that the federal government continues to issue and alter the rules and guidelines for how states would operate their own exchanges.
"The Obama administration appears to be in a mad dash to put this thing together as they go,'' Benson said.
"It's like they're building an airplane that's halfway down the runway,'' he continued. "The governor's not interested in playing along with that.''
Brewer's decision may actually have been foretold.
The governor previously acknowledged she would need legislative approval to set up a state-run exchange. And key Republican lawmakers said they would fight such a move, saying the state should not cooperate in any way with the Obama administration to implement the program.
That opposition was underlined in a statement applauding the governor's decision from Andy Biggs of Gilbert who is in line to be the next president of the state Senate.
"Any exchange run by Arizona would still include an inappropriate imposition by the federal government on our state,'' he said in a prepared statement. "While the Affordable Care Act is the mandate of the federal government, I remain unalterably opposed to the act.''
But Sen. Linda Lopez, D-Tucson, criticized the GOP opposition to a state-run exchange because they do not like what has been referred to as "Obama-care.''
"It is certainly disheartening that Republicans in the Legislature put partisanship first and vowed to derail any attempt to create a state-run exchange,'' she said in her own statement.
But Clint Bolick of the Goldwater Institute, which opposes not only state-run exchanges but the entire federal law, said the issues are not just partisan.
He said in states that run their own exchanges, the Affordable Care Act says companies which do not purchase insurance for their workers are subject to fines of up to $2,000 per worker. Bolick said there is no authority for such fines in states where the federal government runs exchanges, though he conceded that may have been a drafting oversight.
Brewer's decision does not take the state out of the picture entirely.
"We are working with (the federal agency) to determine what exactly that role is and what our responsibilities are and how those costs will be paid for,'' Benson said. In fact, Arizona still has access to about another $20 million from its $31 million federal grant to plan and implement exchanges.
Benson said Wednesday's action should not be seen as a precursor of another -- and more sweeping -- decision Brewer has to make within the next two months: expansion of the state's Medicaid program.
As originally approved, the federal law said anyone earning up to 133 percent of the federal poverty level would be eligible. That currently computes out to about $25,450 a year for a family of three.
Arizona law provides coverage for those up to the poverty level for all but single adults.
More to the point, the law said states had to comply or lose all of their federal Medicaid funds.
The U.S. Supreme Court upheld key elements of the law, including a mandate on individuals to buy health insurance or pay a penalty. But the justices struck down as illegal the provision forcing states to enroll more people.
That leaves it up to individual states to decide whether to go along voluntarily, with the promise of additional federal funds, at least up front, to cover the expanded enrollment.
One big concern is how long those extra federal dollars will be available as Washington seeks to trim its own deficits. That could leave Arizona with a much larger program, putting lawmakers into the politically tricky position of either absorbing the additional costs or having to tell people they are no longer eligible for care.
Arizona Willie posted at 4:19 pm on Wed, Nov 28, 2012.
Hmm, it appears I am being barred from posting. The last couple of days every attempt to post has been greeted with a popup saying my comment appears to be spam.
vwkaferman posted at 4:22 pm on Wed, Nov 28, 2012.
Too all the lazy folk out there unwilling to WORK for what they get, you're welcome for the free healthcare. Anything else you need from me, just take my wallet, might as well.
bubba posted at 5:42 pm on Wed, Nov 28, 2012.
vwkaferman...You don't have to stand for this. There is a ship boarding passengers for the disenchanted heading for Somalia right now. You'll love it there. It's a Tea Party paradise. No taxes, no government, no infrastructue, no laws, or regulations at all!! They're colonizing as we speak. You may be able to run for President of Dumbassistan as it will be known. Start packing now, your paradise awaits!!
Deddzone posted at 6:54 pm on Wed, Nov 28, 2012.
So, Jan who promoted "State Rights" over and over again---dropped that whole concept. I suspect it was too difficult for her to run the state and figure out how to offer an alternative or even just an idea.
I'm not really surprised. Ever since she stopped talking endlessly about the border she has little else to offer...
downtownresident posted at 7:57 pm on Wed, Nov 28, 2012.
Jan isn't remotely qualified to make any of these decisions.
Who wrote the letter for her? Was the draft on the back of a bar napkin?
[beam]
DrJCA1 posted at 9:00 pm on Wed, Nov 28, 2012.
Bubba: it appears that yyou are one of those liberals who believe that every conservative thinks that we need zero government. Hate to tell you, but that's absurd. No one in their right mind would think that. A central government is vital to the functioning of a nation. However, and think this through real carefully, a federal bureaucracy that is so huge and overly-intrusive is just as bad as the zero-based one. Our elected officials have pushed us to the brink of bankruptcy with a trillion dollar deficit every year to fund your wonderful social freebie programs. How long do you really think we can keep that up? Do you also realize that almost half of our population is on some sort of government program? What happens when the takers actually outnumber the providers? There's going to be a boatload of welfare folks who are going to starve to death. I have more than enough for me and my family. I hope you are not one of those who wait for uncle sam to send you a check every month, because your time is drawing down very rapidly. There's simply not enough money on Earth to support 150 million people.
bubba posted at 9:40 pm on Wed, Nov 28, 2012.
DrJCA1...My snarky comment to vwkaferman was just borne of frustration of the ignorance of people that don't realize that everybody infact has had healthcare all along. The fact is that it's the most expensive to taxpayers when a simple problem that could be remedied with a trip to a doctor's office is left to manifest into an expensive emergency room situation where they can't be turned away. And all because that person could not afford the doctor's visit. ACA will prove in the longrun to be cheaper than what we are paying out now for the uninsured. People like vwkaferman believe everything Limbaugh et al tells him. And the fact is he probably doesn't pay into federal taxes, so isn't accually affected at all.
bubba posted at 9:53 pm on Wed, Nov 28, 2012.
DrJCA1 .....The term "Fiscal Comservative" has become an oxymoron. Name the last conservative that had actutally reduced government, balanced the budget and not put the tax burden on the working middle class.
Arizona Willie posted at 10:22 pm on Wed, Nov 28, 2012.
It's for the best. If Arizona Republicans ran it, they would be trying to find a way to siphon funds into the General Fund and some way for their friends to make a profit from the insurance.With the Feds running it, people will get a program similar to Medicare and get much more for their premium dollar.
Arizona Willie posted at 10:25 pm on Wed, Nov 28, 2012.
DrJCA1, the money spent on social welfare programs is dwarfed by the money given to corporations in subsidies and tax cuts.
Corporate welfare is far far bigger than social welfare programs..
soricobob posted at 4:54 am on Thu, Nov 29, 2012.
Amazing to me that the Governor could not come up with a plan better than the Feds.
doc10250 posted at 7:09 am on Thu, Nov 29, 2012.
I notice that once again folks such as vwkaferman miss the boat entirely simply wishing to take care of themselves and to heck with the rest of em. The old "who cares what the poor people are doing tonight"! I am a retiree, living on social security with health issues that PROHIBIT me from obtaining health insurance through any vendor. AHCA is my only way, and because of my conditions, it may provide a lifesaving method for me to get medical help, which right now I cannot get. I am not eligible for medicare yet, and the next couple years are going to be dicey, you can believe that! So since you know so very little about the healthcare needs and problems of the many, why don't you just refrain from comment!
Arizona Willie posted at 9:04 am on Thu, Nov 29, 2012.
doc10250 ... right wingers such as vwkaferman think no one works for anything but THEM.
They accuse people who get any government help of playing the " victim " card but they ( right wingers ) are the one's who play victim.Everyone is stealing from THEM.No one pays taxes but THEM.No one works but THEM.
One can only hope that Karma strikes them one day and they find themselves in the place of the homeless and sick who need assistance.
Deddzone posted at 9:55 am on Thu, Nov 29, 2012.
So, where are the rightwingers and Tea Partyists upset with Jan for not grasping the state-right option? She went on an on about state rights and dropped the ball--big time!
Arizona Willie posted at 12:38 pm on Thu, Nov 29, 2012.
The Tea Partiers and right wingers and Republican Party scream that they don't want government running health care and then refuse to have the state institute a program and default to the Federal Government which simply enables the Feds to institute government run health care which is EXACTLY what they have been screaming they didn't want.
This is really a good thing because now the people of Arizona will be able to sign up for Medicare Lite run by the Federal Government and get a much better deal for their premiums because there won't be any high paid executives getting multi-million dollar bonuses for refusing to pay the bills.
Stevo357 posted at 5:36 pm on Thu, Nov 29, 2012.
No we are upset that a large group of Americans would sacrifice Liberty for your political gain. We have allowed our government to now mandate citizens to buy things. It enters us into a new contract that you may like now, but when the shoe is on the other foot I know the whining lamp will be on and bright!
Arizona Willie posted at 10:58 am on Fri, Nov 30, 2012.
Stevo357, the Federal government has a long history of mandating actions by citizens.The Federal government mandates that people pay Income Taxes.
The Federal government mandated that people register for the draft.
The Federal government mandated that people obtain ( buy ) a Passport to travel abroad.The Federal government mandated that people buy stamps to mail letters.
ETC. ETC. ETC.
Stevo357 posted at 5:09 pm on Fri, Nov 30, 2012.
And I take it you are ok with that??? Liberals are simply slow, there is nothing else that can be said. You do not have to get a passport unless you want to travel. You do not have to buy stamps unless you are going to mail something. You only pay taxes on money you earn.
You must now buy something just for being! Do you get that?? Liberty is not stripped away all at once, it is chipped away by people asleep at the wheel!
wdgnas posted at 6:52 am on Sat, Dec 1, 2012.
stevo357: i agree with you. if you complain about high income taxes, don't earn as much money.