By John H. Fisher II
July 24, 2012
The long-awaited Supreme Court ruling regarding the constitutionality of the Affordable Care Act is finally in, but serious issues and questions remain related to Medicaid expansion and insurance exchanges. On January 12, 2012, the Wisconsin Hospital Association hosted a town hall on health care reform. Health policy expert Billy Wynne, senior vice president and principal of Health Policy Source in Washington, DC, guided WHA members through several key issues including:
The Supreme Court held that a state may choose whether to expand its Medicaid program, and receive an enhanced federal Medicaid match rate for newly eligible individuals, without this decision affecting existing Medicaid funding. However, the Court did not address broader issues such as the terms for Medicaid expansion, whether other Medicaid provisions still apply, and the process by which a state elects to expand.
With respect to a state’s decision whether to expand Medicaid, the Center for Medicare and Medicaid Services has announced that there will be no deadline for a state to make this determination. One question that remains is whether the expansion is “all or nothing.” For example, Wisconsin’s Medicaid eligibility levels are already above those envisioned under health care reform. If Wisconsin chooses not to expand its Medicaid program, does this mean Wisconsin still qualifies for the enhanced federal match for “newly eligibles?” There is currently no clear answer to this question. Uncertainty also remains surrounding the process by which a state elects to expand. For instance, if a Governor wants to move forward with Medicaid expansion, it may find it difficult to do so without the support of the state’s Legislature. It is also unresolved whether a state that chooses to expand now, may later opt out.
The Secretary of Health and Human Services, Secretary Sebelius, issued a letter dated July 10, 2012, clarifying that the Court s act of striking down a portion of Medicaid expansion does not affect other provisions of the law.
With respect to the insurance exchanges, Secretary Sebelius reiterated that funding for the new insurance exchanges will be available to states, no matter where they are in the process of establishing a marketplace, and no matter the type of exchange. In addition, states will now have until the end of 2014 to apply for such funds. However, the practical challenges of implementing either a state-based, state partnership, or federally facilitated exchange, in a relatively short period, are abundant. The administrative difficulties of the federal government running federally facilitated exchanges at the state level is also unresolved.
The political implications surrounding the upcoming presidential and congressional elections will surely impact the Affordable Care Act. The Obama administration will likely issue additional guidance soon and shows every indication that it plans to move reform forward. The extent that the election cycle and the eventual outcome of the November elections will have on the implementation of the Affordable Care Act is yet to be seen.
Ruder Ware continues to review all health care reform developments. If you have any questions about the Affordable Care Act, the Supreme Court s decision, or any other health care issues, please contact John Fisher, CHC, CCEP, the author of this article, or any of the attorneys on the Health Care Focus Team of Ruder Ware.
Check our blog at www.healthlaw-blog.com for more frequent updates.
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