Health Care Implementation Will Be Bumpy But Fruitful, Says Panel


The Obama administration’s quickening push to implement health care reform is likely to create success stories and debacles that differ across states, a panel of experts said Monday. But overall, the multi-agency federal effort to set up state-level insurance exchanges is proceeding effectively, despite prospects that GOP resistance to “Obamacare” may dominate the 2014 elections, the panelists said.

Speaking at the Brookings Institution, leaders from state government, business, academia and think tanks dismissed assertions by some that the unfolding scandal of the Internal Revenue Service’s handling of organizations’ applications for tax-exempt status could weaken confidence in the tax agency’s ability to protect citizen privacy while performing its role in implementing the Affordable Care Act.

“The IRS problems were not a violation of privacy or secrecy,” said Henry Aaron, a longtime specialist in health care economics at Brookings who is working with the District of Columbia in setting up its health insurance exchange. “Just because the IRS allegedly mishandled implementation of one law doesn’t mean there are political malefactors working on the health care law.”

In Maryland, “We deal with lots of private information and take security very seriously,” said Joshua Sharfstein, the Maryland secretary of health and mental hygiene.

Elaine Kamarck, senior fellow and director of Brookings’ management and leadership initiative, noted that the Affordable Care Act is the “first new law to be implemented in 10 years,” comparing it to the Medicare Part D prescription drug benefit and the standup of the Homeland Security Department in 2003. “There were predictions of disaster, but both exceeded expectations and showed that fears were overblown,” she said, stressing the health care law’s complexity -- 50 states, 50 insurance commissioners and 37 votes by House Republicans to repeal it.

The Health and Human Services Department is working toward a Jan. 1 deadline for launching of state exchanges, with enrollment to be completed by Oct. 1. Eighteen states have agreed to set up state-based exchanges, seven are working with HHS on “partnership exchanges” and 26 states are setting up federally facilitated exchanges.

Most components of the law -- from tax credits for employers to prescription drug benefits to restrictions on insurance companies’ profits and ability to reject applicants -- are popular, according to polling released in March by the Kaiser Family Foundation. The exception is the individual mandate to purchase insurance, which is favored by only 40 percent, but which is also the component most familiar to Americans (74 percent), a result of the fact that it was most hotly debated before passage, said Shelia Burke, former chief of staff to Republican Senate Leader Bob Dole of Kansas and now a lecturer at Harvard University’s Kennedy School of Government.

“The truth is we still don’t know many of the answers,” Burke said, citing such questions as who among the estimated 30 million uninsured will participate, which insurance companies will offer plans and at what premium rates. Many of the nation’s so-called “young healthy invincibles,” she added, may balk at paying a $4,000 annual premium if the fine for not joining is a mere $95.

The critical question is how states respond, Aaron said, citing a stark difference between Massachusetts, Maryland and the District of Columbia, which are going “all out” to make the law work, and Michigan, Florida and Texas, about which, he said, “maybe not so much.”

But Aaron praised the administration’s efforts and predicted that deadlines will be met. “If states don’t meet the Oct. 1 deadline, then they will by January or March, and as legislators begin to bite into the success stores in some parts, there will be major screw-ups in others. The question is whether they use success as a model or whether the disinformation system will have taken over with every problem turned into a debacle.”

Senate Minority Leader Mitch McConnell, R-Ky., has said health care will be the major issue of 2014, Aaron noted.The difference between “Obamacare” and past expansions such as Medicare, he said, is that the earlier plans had bipartisan support and were designed with the eventual administrators in the room. Given today’s “fast-reacting policy analysis environment,” Aaron said, critics weigh in “quickly and sloppily,” so that the “elbow room for administrators working through the problems before they go public has narrowed.”

An on-the-ground industry view came from Bruce Caswell, president and general manager of the health services segment at Maximus, a consulting firm on governmental health services. Anticipating “confusion on what Day 1 of implementation looks like,” he said “this is version 1.0 of the law but there will be a 2.0 to reflect improvements.”

“Maryland is very excited for Oct. 1,” Sharfstein said. Marylanders see it as a chance to “control our own destiny.” Sharfstein has appeared on panels with opponents of the law, to whom he pointed out that by opting not to start their own state exchange, they now have less control.

“People project their hopes and fears onto the system,” he said. Though some are worried about not enough citizens signing up while others are concerned that the system will be overrun by too many.

“We see the law as a set of tools to customize and control costs, not a guarantee,” Sharfstein said. But he pointed to a consensus governance structure in a nine-member implementation board and a “can-do spirit” even when there are disagreements.

Republican efforts to defund the law, Kamarck said, have already forced HHS Secretary Kathleen Sebelius to tap general funds to set up the five-agency hub that centralizes financial and health data for applicants. Burke said there is definitely less money than the Treasury Department had estimated was needed. “I don’t know the exact amount but it’s insufficient,” Aaron added. “This approach of strategic governance to try to make the legislation fail is a Luddite approach to politics. The law on the whole is a step forward that can be improved.”

He foresees “an extended and very rough voyage,” but said “it will get us where we want to go.”

(Image via Hirurg/

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