Perspectives: State/Federal Divide Blurs in Health Care Reform

For state officials charged with turning health care reform into reality, 2014 is here in 2010.

When Congress debated the Patient Protection and Affordable Care Act, just a few months ago, the target date of 2014 for full implementation of health insurance exchanges seemed far away. To many supporters, it was too far away. To some opponents, kicking the target date down the line was a sign that real results were distant phantoms.

But to state lawmakers gathered at the National Conference of Insurance Legislators' summer meeting, 2014 seemed uncomfortably close. In a sweltering Boston conference room, federal and state officials as well as private-sector experts demonstrated and repeated one message: to make this work, there is no time to waste.

"We can't wait until 2014," said Kansas Insurance Commissioner Sandy Praeger, chairwoman of the health insurance and managed care committee of the National Association of Insurance Commissioners.

The NAIC lobbied hard for a substantive, comprehensive role for state officials in developing the state-based systems that will implement vast areas of health care reform, from medical loss ratios to rate review to the insurance exchanges -- which are nothing less than inventing a whole new way to shop for insurance. The NAIC is mentioned, by name, throughout the health reform law.

"Be careful what you wish for," Praeger said.

Many lawmakers in the room opposed the health care law. Nearly all are opposed to just about anything that gets the federal government more involved in supervising the insurance industry. But as lawmakers learned more about the size of the task that awaits their state governments -- whether they choose to accept it or not -- brows furrowed, eyes glazed and there was a lot of uncomfortable shifting in seats. Then again, maybe that was just the poor air-conditioning.

In a later NCOIL session, lawmakers were advised to use the enormous undertaking of creating new state infrastructures as an opportunity to create new efficiencies, said Robert Carey, a consultant and former director of planning and development for Massachusetts' Commonwealth Health Insurance Connector Authority, which was in many ways a model for the new exchanges. State officials should seek out ways to "streamline, consolidate or eliminate existing public subsidy programs."

Just as importantly, state legislators and regulators should strive to create systems that best match the needs and wants of their unique populations, said Cheryl Smith, former director of the nascent, and voluntary, Utah Health Exchange. Use what flexibility the health care act allows, she said.

"You need to do what works for your populations," Smith said.

The health care reform debate didn't end when the House of Representatives passed the law on March 21. Nor did it end at the NCOIL meeting. Of the 18 subject-matter sessions scheduled during the summer meeting, eight were on health care. Everyone knows this is serious. And the line between what's a state issue and what's a federal issued continued to blur.