States Sovereignty to be Violated by Feds

March 26, 2013

Feds will need to enforce ACA reforms in 4 states

The feds will be overseeing the health care law in Missouri, Oklahoma, Texas and Wyoming. | AP Photo

Source: JASON MILLMAN, POLITICO

At least four states won’t enforce new sweeping insurance market reforms rolling out next year with the health law — leaving federal health officials in Washington to pick up the slack, yet another wrinkle in Obamacare implementation.

Insurance regulation is a huge responsibility that’s been closely guarded by the states. That’s why the Obama administration and those closely watching the rollout of Obamacare believe that even states that have sworn off the law’s coverage expansions will still enforce its new measures — including new benefit mandates, cost-sharing guidelines and rules on how insurers rate customers — to retain control over their health insurance markets.

But the feds will be overseeing the health care law in Missouri, Oklahoma, Texas and Wyoming after those states told HHS they couldn’t or wouldn’t implement the new rules.

“We are enforcing because Oklahoma notified … that it has not enacted legislation to enforce or that it is otherwise not enforcing the Affordable Care Act market reform provisions,” Gary Cohen, director of the federal Center for Consumer Information and Insurance Oversight, wrote to the Oklahoma Insurance Department on Friday. Officials in Missouri, Texas and Wyoming received similar letters, an agency spokeswoman said.

The enforcement letters come a little more than a month after a Commonwealth Fund report found just 11 states and Washington had started to adjust state laws to prepare for seven major ACA insurance reforms taking effect in 2014.

The Department of Health and Human Services, however, has downplayed the issue. It says many state insurance commissioners have broad authority to enforce federal laws — even if their states haven’t given them explicit direction on new ACA requirements.

Teresa Miller, who oversees implementation of the ACA’s insurance reforms for CCIIO, last week said the feds have been in talks with states that won’t enforce the law.

“[CCIIO] has been working to collaborate with those states and really leverage state processes and resources to accomplish CMS’s direct enforcement,” said Miller, a former Oregon insurance commissioner, on a conference call hosted by the Commonwealth Fund.

John Doak, the insurance commissioner of Oklahoma — a deeply red state that’s still challenging Obamacare in federal court — told HHS in a letter that he didn’t have the legal authority to enforce federal law. And Doak took the chance to remind federal officials of how unpopular the law is in his state.

“In 2010, State Question 756 received overwhelming support by voters of an amendment to the Oklahoma Constitution prohibiting laws which compel individuals, employers and providers to participate in health care systems,” Doak reminded HHS.