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NRO’s health-care blog.

Obamacare Health Benefits Exchanges Are Flailing and Failing



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(This post has been corrected from its initial version, with an apology.  Please see here.)

The most disappointing news on the Obamacare front these days is that at least two Republican governors cannot wait to implement Obamacare in their states. Apparently, one Republican state senator in Oklahoma has finally decided to prevent an Obamacare exchange bill from reaching Gov. Mary Fallin for signature. Fair enough, but how did it get this far in the first place?

In Virginia, Gov. Bob McDonnell has forced amendments to prevent health plans participating in his state’s Obamacare exchange from covering abortions — at least, that’s what he thinks he’s done. In fact, U.S. Secretary of Health & Human Services Kathleen Sebelius will decide whether Virginia’s health plans will cover abortions, because she’s the one who will certify the exchange — or not. Because 100 percent of Obamacare’s subsidies to individuals in the exchanges come from the federal government, Sebelius’s whims will decide the rules governing the cash flows. Virginia will simply be stuck with paying salaries to the bureaucrats and fees to the vendors and consultants who operate the exchange.

What is motivating these Republicans? They have surely fallen for the talking point that if they don’t implement a state-based exchange, the federal government will rush in and impose one on them. Oh, really? Is that what they’ve seen in Florida, where Gov. Rick Scott has gone so far as to send back the initial federal grant that his predecessor wheedled out of Secretary Sebelius?

In fact, the U.S. Department of Health & Human Services has shown zero will or ability to establish exchanges in states that resist Obamacare, and that is hardly going to change. Despite the Obamacrats’ brave talk that they will keep regulating despite the looming government shutdown, congressional Republicans’ commitment to defunding Obamacare only means that Secretary Sebelius’s ability to implement Obamacare will decrease in 2011 and 2012.

And it’s not like they achieved much in 2010 except to churn out thousands of pages of regulations and immediately issue waivers exempting their friends from those very regulations. And their friends’ performance has been equally underwhelming.

Look at California, the first state to establish an Obamacare exchange, signed by former Governor Schwarzenegger last September 30. Governor Brown’s secretary of health and human services wants California to be the “lead car” in imposing Obamacare. Governor Schwarzenegger’s former policy adviser Herb Schultz is now Secretary Sebelius’s director for the region covering California, so state and federal Obamacrats are surely moving together swiftly to implement health reform.

Or maybe not. Although it’s existed for over half a year, the California exchange’s board of directors has never had a meeting. Its only achievements so far are to have provided unpaid board slots for Kim Belshé (Schwarzenegger’s secretary of health and human services), Susan Kennedy (his chief of staff), and two others. (Advocates hope that the board’a fifth slot will be rounded out with a Latino or person of color.)

California’s Obamacare exchange’s only achievement has been to attach golden parachutes to friends of Schwarzenegger’s and Brown’s. The Obamacrats can’t even get an exchange operating in the state which is the most committed to Obamacare. They’re sure not going to do it in a state that resists them.



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