Looming deadline forces Oklahoma’s hand on a health exchange

Oklahoma faces a Nov. 16 deadline to to submit a blueprint for creating a health care insurance exchange or have one created for us by the federal government. This blog post from July explained how lack of cooperation by state leaders makes a federally-designed and operated exchange almost certain.

The Supreme Court’s decision to uphold the health care law, or Affordable Care Act (ACA), will soon compel even the most reluctant states to address their central responsibility under the law – state-based health insurance exchanges.  Exchanges, which we’ve blogged about here and here, are online competitive marketplaces for consumers to purchase private insurance or enroll in state programs like Medicaid.  Exchanges are critically important, largely because they’re the only venue for eligible state residents to claim and apply new premium tax credits towards the purchase of a health plan, a benefit millions of Americans will be entitled to under the law in 2014.

Up until now, states have faced a choice between two basic options: to operate their own exchange or let the federal government operate one for them.  Fourteen states have already established their exchanges and several others are well on their way in terms of planning and implementation.  States have until November 16th – just four months from now – to submit a detailed blueprint of how they plan to implement and operate a compliant state-based health insurance exchange.

It seems virtually certain Oklahoma will miss the November 16 deadline.  We haven’t moved on exchange planning in over a year.  The Legislature tried and failed to pass exchange-establishment bills during the last two sessions, bills that wouldn’t have passed muster as a blueprint for our state-based exchange anyway because they weren’t compliant with federal law.  Gov. Fallin won’t be calling a special session and the Insurance Commissioner wants legislative guidance before he’ll move forward.

If federal intervention on Oklahoma’s exchange now seems inevitable, the response from state elected officials following the Supreme Court ruling seemed oblivious to this reality.  They’ve vowed to fight the law and keep Oklahoma free from federal intervention.  Ironically, their promise to continue ‘fighting’ has the practical effect of ceding more authority to the federal government, not less.  There are still innumerable ways for Oklahoma to influence the exchange-establishment process, but they all require state leadership to communicate a good-faith willingness to cooperate and comply.  Outright opposition forecloses our ability to partner with HHS in any way while our exchange is being built.

Keep in mind, the federal government doesn’t want to operate ours or any other state’s exchange.  Exchanges were designed as state-based instruments, and even in states where the federal government will initially build and operate them, regulators will be looking to hand-off major components to states as soon as they show themselves willing and able to do so.  But in states that show themselves unwilling or unable to move towards a compliant exchange, the federal government is prepared, and legally obligated, to operate their exchange for as long as it’s necessary.

With the Governor, Insurance Commissioner, Attorney General, and a handful of lawmakers rallying around repeal and promising voters continued opposition, an exchange run wholly by the federal government without input from Oklahomans looks increasingly likely.  Continued opposition from top elected officials guts our credibility with the very people we’ll eventually need to convince that we’re willing to operate our own compliant exchange – senior staff at federal agencies tasked with enforcement.

So long as an outcome to the health care challenge was pending, state leaders could oppose the law and delay action.  Now that it’s settled, such a posture is increasingly untenable.   If Oklahomans want any say during the exchange planning process, state leaders need to can the counterproductive political rhetoric and work steadily on a plan to proceed in partnership with HHS.  There just aren’t any other options left.