HHS pushes back state health reform deadline


Responding to Republican criticism, the Obama administration is giving states an extra month to make a key decision about how to implement the Affordable Care Act.

State lawmakers were supposed to tell the Health and Human Services Department by tomorrow whether they wanted to set up their own health care exchange -- an online marketplace where consumers can choose from a variety of competing private insurance plans. The states have the option of setting up their own exchange, letting the federal government run its exchange, or entering into a partnership with the federal government. The states that chose to set up their own exchanges were supposed to submit a blueprint for the system by Dec. 14.

Now, states must tell HHS by Dec. 14 if they will set up their own state-based exchange, and if they choose to do so, must also submit their blueprint by that date, a spokesperson for HHS tells The department extended the date today in an "effort to be as flexible as possible."

The move comes in response to a letter sent yesterday by Virginia Gov. Bob McDonnell, chair of the Republican Governors Association, and Louisiana Gov. Bobby Jindal, asking President Obama to step in and extend the deadline.

"As has been stated many times, before making any final policy decisions, governors must carefully consider the short and long-term implications of an expanded entitlement program and the consequences of significantly increasing the size of government to manage these programs," they wrote.

In a letter in response today, HHS Secretary Kathleen Sebelius noted that the department has been working with states for two years -- since the Affordable Care Act was passed in 2010 -- to plan on how to build the exchanges. "We are committed to providing you with the flexibility, resources, and technical assistance necessary to help you achieve successful implementation of your state's Exchange and look forward to continuing to work with you as we implement the health care law," she wrote.

A number of mostly Republican-led states have stalled in making any decisions, largely because of the uncertainty the health care law faced during the election season. Now that Mr. Obama has won a second term, however, the states must get to work implementing the law. The states -- as well as the federal government -- are expected to have their exchanges set up and ready for open enrollment by Oct. 2013.

Today Texas, South Carolina, Indiana, and Wisconsin -- all states with Republican governors -- indicated they will opt for a federally-run exchange rather than a state-run exchange.

In a letter to Sebelius today, South Carolina Gov. Nikki Haley wrote that the "state-based exchange programs are not state-based at all. Instead, they simply pass along to the state the burdens of a new and cumbersome bureaucracy."

An HHS official told in response that while states must follow certain guidelines in establishing their exchanges, those that choose to set up their own exchange would be completely in charge of the system. Furthermore, the federal government is giving states grants to set up the exchanges, which states much eventually self-fund. Some states have already received more than $100 million in grants to set up their exchanges.