For healthcare industry watchers, the "will-they, won't-they" decisions of each state's Medicaid expansion decision have been as exciting as the NFL Draft or National Signing Day for college football. Rather than thinking about team needs, the real focus is on these quasi-celebrities that have the potential for greatness, whose single decision affects the lives of millions. The late Wednesday rumors of Florida Gov. Rick Scott's press conference to accept Medicaid expansion shivered through my Twitter feed, as if a highly touted recruit was about to announce his choice between Alabama and Ohio State.
Similarly, instead of looking at each state's legislative makeup, uninsured rate or managed Medicaid laws, the Medicaid eligibility expansion has focused on governors, specifically the Republicans that are likely to run for president. Rick Perry (Texas), Bobby Jindal (Louisiana), Nikki Haley (South Carolina) and Bob McDonnell (Virginia) have all come out against the expansion, and New Jersey's Chris Christie is still on the fence. With the success of Obamacare in the air and the welfare of millions of citizens in jeopardy, when was the last time governors wielded this much clout?
These governor's decisions have more to do with winning the GOP primary of 2016 than the dynamics within their respective states. The calculus against Medicaid expansion may turn out to be similar to the in-hindsight genius of then-Senator Obama's opposition to the Iraq War. Just as Obama was able to trump Sen. Hillary Clinton in the Democratic primary of 2008 by becoming a symbol of intensifying dissatisfaction with that war, these GOP executives are attempting to position themselves as prescient leaders who came out against the well-intentioned Obamacare.
Just as Republicans against Obamacare had hoped for help from the U.S. Supreme Court and the Romney campaign, these presidential aspirants are taking a gamble on a future event out of their control. But in this case, widespread dissatisfaction with Obamacare in 2016 may be more likely than a Supreme Court overturn or a Romney victory ever was. In early 2016, the massive initiative may be largely successful but still experiencing growing pains that can be exploited by a presidential campaign.
There are several ways Obamacare may falter. The penalty for not carrying insurance will be low (only $95 per person in 2014) thus creating a lack of interest among potential higher-income enrollees. The overall dynamics of healthcare favor movement toward narrow networks, and people may not be able to see their favorite physicians. The accountable care organization model may not deliver on its promise to reduce costs. Currently open to groups of 50 or less, the exchanges will be open to anyone in 2017, threatening the end of employer-based coverage. A confluence of these events could be fomented into a primary victory by any of these Republican governors.
Rick Scott is unburdened by the lure of a 2016 presidential run. His focus is on running for governor as a Tea Party candidate in a state that President Obama won in 2012, against a challenger in Charlie Crist that will likely have the backing of the Obama election apparatus. Just as conservatives originally envisioned the individual mandate in the 1990s, Republicans like Scott will reframe eligibility expansion as a personal responsibility with a free-market solution, not government overreach.
Florida's Medicaid eligibility expansion comes on the same day that the state received federal permission to mandate that all Medicaid beneficiaries enroll in managed care. Managed care companies have been eagerly awaiting this Medicaid waiver, since the move would add about 2 million potential customers to their rolls at a time when commercial enrollment is stagnant. Scott's decision to expand eligibility, paired with the waiver from CMS, gives insurers an additional 1 million people in the state who will be enrolled in health plans in the next two years. UnitedHealth, Humana, Aetna/Coventry, AmeriHealth Mercy, Centene, WellCare and WellPoint acquisition Amerigroup are among those lining up to bolster their enrollment with these millions of new members in Florida.
The Republican governor can still cling to the belief that free-market competition drives down costs while improving efficiency, even though the results of Florida's five-county managed Medicaid pilot program are not conclusive on that front. Negotiations between Florida and CMS effectively froze in spring 2012 as both parties awaited the result of the Supreme Court case. As soon as the high court made Medicaid eligibility optional for states, the choice became a negotiating tool for both Florida and federal officials, with only one likely outcome: eligibility expansion would come paired with managed Medicaid expansion, barring a Romney victory.
When the AP reported on Wednesday morning that the feds had given approval for mandatory managed Medicaid in Florida, it was like hearing that the No. 1 high school recruit had gotten a Notre Dame tattoo -- a pretty good signal of what Gov. Scott's forthcoming decision would be.
Florida currently has one of the highest uninsured rates in the nation, more than 20 percent. That percentage should dwindle to the single digits in the next few years, something that won't happen in Texas, Louisiana or South Carolina because of the national aspirations of their chief executives. Other Republican governors have turned down expansion for more sundry reasons; the governor of Pennsylvania is politically inept, for example, and the Tennessee governor has limited veto power and largely bends to the will of the notoriously conservative legislature.
The decision made by the popular Chris Christie will say more about 2016 than how best to help the poorest residents of New Jersey, which already has a fairly robust Medicaid package. The winner of the Republican primary will be the one who convinces that constituency that he (or she) was the most against Obamacare, the way that Obama was able to convince Democrats about the Iraq War. The winner of the GOP primary will then lose to Hillary Clinton in the general election, because she is savvy enough to turn dissatisfaction with federal healthcare reform into something constructive.
Instead of campaigning on a rehash of the repeal debates, Clinton should promise to deliver a more robust Public Option and expanded Medicare for 2017. The 18 percent uninsured in South Carolina and Louisiana, and 25 percent uninsured in Texas, will only have to wait a few more years for healthcare.
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