Let The Red States Vote on Health Care

Date: 5 Oct 2013 | posted in: From the Desk of David Morris, The Public Good | 0 Facebooktwitterredditmail

In 2009, when Congress passed the health care bill, only one Republican voted in favor.  In 2010, with opposition to the new health care law as their rallying cry, Republicans gained a net 63 seats and control of the House of Representatives.  They also won control of 11 additional states, bringing their total to 25.

On October 1st, the first day of the new federal fiscal year and the launch of the new health care exchanges, the victors of 2009 collided with the victors of 2010.  The entire nation felt the impact.

Even when it ends, the government shutdown will have demonstrated the willingness, indeed the eagerness, of Republicans to do everything possible to stop the health care law. Already well-funded campaigns are trying to persuade healthy 25 year olds not to purchase health insurance through the exchanges.  If successful, these campaigns will result in higher premium rates for those who do sign up, which will spawn dissatisfaction with the new law.

The health care law finances “navigators” to help people sign up, similar to what Medicare has.  But red states are hamstringing navigators, often requiring them to pass licensing exams, obtain insurance bonds, and pay heavy fees.  Tennessee recently adopted an emergency rule requiring any “enrollment assister” to undergo a criminal background check, fingerprinting and take 12 hours of course work.  The more problems people have with the exchanges the greater their dissatisfaction will be with the new law.

Given this level of intransigence what is to be done?  President Obama and the Democratic Party are resolute about rolling out the health law in all 50 states.  They refuse to give in to what they see as blackmail.  But I believe the country, and the Democratic Party itself would be better served if Republican controlled states were allowed to opt out of the Affordable Care Act, but only under three conditions.

First, opting out requires opting out of all provisions of the law. No individual mandate.  No health exchanges.  No requirement that insurance companies spend 80 percent of the premium dollar on health care and cover people with pre-existing conditions.  No federal incentives contained in the new law will be provided.

Second, those states that are implementing the health care law will be given great latitude in designing their new health systems. Several states, for example, want to create a single payer insurance system similar to that which Canadian provinces have had for almost 50 years.  The existing law allows significant autonomy only in 2017.  A bill should be passed that gives them the authority to do so immediately.

Third, the people must clearly support the opt out.  The state legislature must pass a bill.  The governor must sign it.  And a ballot referendum must be passed.

From what I read and hear from Republican leaders, none of these conditions should prove troublesome.

Some will argue that giving in to the Republican demand would abdicate federal responsibility for the poor and uninsured since two thirds of poor, uninsured blacks and single mothers and 60 percent of the country’s uninsured working poor are in states that might opt out.  But much of the damage to these groups has already been done and the federal government is powerless to intervene. Twenty-one of 25 Republican controlled states have refused to expand Medicaid coverage, denying insurance to millions of their citizens despite the fact that the federal government would pay 100 percent of the costs, dropping to 90 percent by 2020.  That refusal to expand Medicaid will make it very difficult for those who would have qualified for Medicaid to purchase private insurance through the exchanges because they are ineligible for federal subsidies.  The original law mandated expanded Medicaid.  Therefore Congress felt no subsidies for buying private insurance for this group would be needed. The Supreme Court overturned that mandate.  The result is that an estimated 8 million Americans who are impoverished and uninsured will be ineligible for assistance in Republican controlled states.

If the Republicans agree to hold referenda, we can expect those 8 million Americans and many others who benefit or will benefit from the health care law to actively participate. Unlike in 2009, when most Americans had no idea what changes Congress was debating, a 2014 debate will be informed by the real changes that are occurring.  Voters in Kansas and Wisconsin can see what is happening next door in Colorado and Minnesota.

Because the referenda will coincide with 2014 election campaigns in which most state legislators and all members of the House of Representatives will be up for re-election, a health care debate will give citizens not only the opportunity to opt out but also the opportunity to truly opt in by changing the composition of their state houses and putting in place governments that remove obstacles to expanded and lower cost coverage.

If states do opt out, the United States will become the world’s biggest social laboratory.  Some states will operate under a pre-2009 health structure with large numbers of uninsured and a system dominated by private insurance companies.  Others will create systems that provide universal access, likely with a public option.  By 2016, the differences should play an important role in the presidential election.

Some might argue that if many states were to opt out the viability of the new health care system will be undermined.  But the experience of our neighbors to the north teaches us otherwise. Canada’s health system is managed at the equivalent of our state level.  Even the largest Canadian provinces have the population of small US states.  The average Canadian province is the size of a big US city.  Yet on almost every metric, from coverage to cost to outcomes to customer satisfaction their health systems score higher than ours.

Allowing the red states to secede will allow the executive branch to focus on helping those states that are trying to implement the health care law.  Allowing the blue states to create the kind of health system they truly want will allow us all to learn from their innovations.   Requiring a vote of the people before a state can secede will generate intensive discussions in hundreds of communities about what they want in a health system, a discussion informed by the experiences of their neighboring states.

President Obama and the Democratic Party should let the red states go.









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David Morris is co-founder of the Institute for Local Self-Reliance and currently ILSR's distinguished fellow. His five non-fiction books range from an analysis of Chilean development to the future of electric power to the transformation of cities and neighborhoods.  For 14 years he was a regular columnist for the Saint Paul Pioneer Press. His essays on public policy have appeared in the New York TimesWall Street Journal, Washington PostSalonAlternetCommon Dreams, and the Huffington Post.