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How's Obamacare Turning Out? Great If You Live in a Blue State, and 'Screw You' If You Have a Republican Governor

Coverage for uninsured is cheaper than expected for millions, but red-state residents in poverty are facing pain.

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Red State Realities

The exchanges are one of two major pathways to expanding coverage. The other is via state-run Medicaid programs, which is health care for the poorest. The New York Times reports that Republican governors have not set up exchanges—and federal officials have yet to fill that void, even though the law says that they will. Those states also rejected expanding Medicaid to “millions of poor people,” even as the law offers nearly full federal subsidies for the first half-dozen years.   

“That benefit is not just to individuals but to local economies,” said Alwyn Cassil, spokeswoman for the Washington-based Center For Studying Health System Change. “The hospitals are very angry with those folks.”

Beyond Republican Party propaganda spreading outright lies about Obamacare, there are other real implementation issues. They concern the progress of states setting up the exchanges and then how the feds will step in when states fail to act. California’s exchange told the insurers what benefits to include in its plans, but the feds might not go that far and just bundle pre-existing health plans for individuals. That may result in fewer benefits offered.

How small businesses will react is another variable. Small businesses under 50 employees are eligible for tax credits. Business with more than 50 employees that don’t offer workers healthcare can face big fines. How that will alter hiring decisions is an open question, promoting much fear-based coverage in the business press.

There are also questions about which employee groups may not be helped, notably trade unions whose members work for different employers and currently have health coverage under older federal programs. Those unions are hoping upcoming federal regulations will address their concerns.  

Getting accurate answers to these questions is difficult, Cassil said, because the most vociferous critics and boosters are invested in the law’s success or failure. “It’s very difficult to find people who don’t have a dog in this fight,” she said. 

Take outgoing Montana Democratic Sen. Max Baucus, who, along with Ted Kennedy oversaw its drafting in the Senate. Baucus has been quoted as saying Obamacare implementation is a “trainwreck.” However, he was responsible for many of the legal ambiguities that have created today’s implementation challenges. The law’s drafting did not follow the usual practice of going through a House-Senate conference committee to find and fix technical problems. In effect, it was published without being edited.

It’s important to assess Obamcare by stepping back from today’s politics. Broadly speaking, the law has three waves of reform and we are now approaching the start of the second wave. The first wave allowed adult children to stay on their parents’ policies until they were 26 and got rid of annual coverage caps. Those were popular policies, touted by Obama and helping his re-election in 2012.

The second wave is creating state insurance-buying exchanges that will offer policies to uninsured individuals and small businesses. Another piece is offering poor people care by expanding coverage under state-run Medicaid. The third wave is making changes in how Medicare, the federal program for the elderly, pays doctors. There are pilot programs to encourage teams of doctors, not specialist after specialist, to treat patients and be paid for the results—not cutting checks for every test.

Rightwing critics as recently as Thursday were issuing reports slamming Obama for missing key deadlines with writing the federal regulations that states have to follow—including how the feds will step in where states have not created their own insurance exchanges. Some of those delays have come because the GOP-controlled House has delayed funding, and because reactionary GOP governors like Texas’ Rick Perry, also have not cooperated.