Since becoming law, ObamaCare, even though controversial, has proven to be remarkably durable. Not only did this act narrowly pass Congress, it had to overcome many legal obstacles, the largest being a challenge by twenty-six state governments. After two years of lawsuits, this (now) law worked its way through the federal court system and finally reached the United States Supreme Court. This past June, the U.S. Supreme Court ruled by a 5 to 4 majority to uphold nearly all the legal points of contention of this law. The most important was the “individual mandate” that compelled every American to purchase health insurance or pay a fine. The Supreme Court also ruled by a 7 to 2 vote not to force individual states to expand Medicaid coverage.
Another important part of this act had stipulated each individual state must put more of its citizens into the Medicaid program or risk losing the federal matching funds. Federal funds pay 57% of Medicaid costs in each state. Consequently, the first part of the Court’s ruling gives constitutional authority to move forward with the act, while the second part weakens the law by taking away future funding designed to require states to expand their Medicaid program. However, it did leave in place the generous financial carrot held over individual states to force the expansion of Medicaid.
According to the Rasmussen Poll, ObamaCare remains as unpopular today as when it became law in 2010. This level of unpopularity has remained unchanged even after this summer’s Supreme Court’s decision and the results of the presidential election. Also, ObamaCare remains just as much a mystery today as when it was being created behind the closed doors of the White House and Congress. This 2,700-page law contains many portions that are very difficult to understand.
The United States Department of Health and Human Services (HHS) has yet to create many of the rules and regulations needed to make this act work. In fact, they are still writing many portions of the act. Like it or not, ObamaCare is the law of the land and 2013 will be the transitional year before it becomes fully implemented in January of 2014.
For Missouri legislators, there are three main areas of concern in regard to ObamaCare as we approach the beginning of the new Session in January. First of all, 2013 will see new lawsuits putting pressure on key aspects of the ObamaCare law. Two main legal suits are 1) the HHS’s contraceptive mandate and 2) a legal argument challenging the authority of the IRS to implement a rule in allowing federal healthcare exchanges to distribute taxpayer subsidies.
Secondly, Missouri is one of about thirty states who have made little effort to establish a healthcare exchange. Health and Human Services has extended to February 15, 2013 the opportunity to establish an exchange. Many states, though, including Missouri, are leaning toward allowing the federal government to handle the healthcare exchange burden. The main reason is the final word for all decisions within the insurance healthcare exchanges belongs to Washington, not the states. The truth is that little to no power will be shared with the states, but at this time there is little to no movement by Missouri to set up an exchange.
Finally, perhaps the most important decision that Missouri legislators will make in regard to ObamaCare will be the expansion of Medicaid. The Supreme Court gave state governors the power to say “no” to Medicaid expansion without losing existing funding. State governors and lawmakers alike see this as “free money,” at least in the short term. In an effort to get more states on board to expand Medicaid, the federal government has offered to foot the entire bill for all new recipients through 2019 before gradually dropping off to 90% funding. With ObamaCare, Medicaid is expected to increase $76 billion in the next decade.
Unlike the healthcare exchange issues, very few states have firmly rejected Medicaid expansion. Pressure to accept the “free money” may be too difficult for even conservatives to reject, given the budgetary shortfalls of most states. Long-term ramifications of ObamaCare on federal and state governments, no doubt, will be very costly.