Court took least disruptive route in healthcare ruling

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Supporters and opponents have been arguing over many of the same provisions for three years, going back to the early legislative proposals in the summer of 2009. But now that the law has survived the Court and many of the more significant changes are one step closer to reality, what are the likely effects of the ruling and the law’s continued implementation?
 
The most immediate impact will be on the November elections. Flogging ObamaCare helped Republicans take back the House in 2010, and by it surviving the Supreme Court, the law remains a prime political weapon this November.
 
Republican candidates will argue that the November elections are the last chance to repeal the law. If Republicans sweep to power with President Romney and a Republican Senate, they will have the last, best opportunity to repeal the law or gut it before its major changes take effect in 2014. If President Obama is reelected or Democrats hold onto power in the Senate, the law will likely be permanently ensconced.
 
Running against the law would likely resonate. The law remains deeply unpopular, as it has since its passing. A recent AP-GfK poll showed only a third of the public supports it. Only 21 percent of independents support it.
 
Given these grim numbers, don’t expect President Obama and Democratic candidates now rushing to promote the Affordable Care Act.
 
In the end the Court ruling was a wash for the president: a ruling to overturn the law would likely have been fatal to his reelection, but cheating political death doesn’t make for a winning campaign issue when the public is still opposed.
 
In addition to the campaign trail, the ruling will have a significant impact in the states.
 
The Court gave states a more empowered choice whether to expand their Medicaid programs beginning in 2014. The federal government will pay 100% of the expansion through 2016, but states will be responsible for 10% after 2020.
 
The Court ruled that the federal government could not withhold existing Medicaid dollars from states if they chose not to expand their programs.
 
Since that threat is off the table, states may wait until after the Centers for Medicare and Medicaid Services (CMS) answers unresolved questions before determining whether to expand.
 
How flexible will CMS be with states that choose not to expand? Will there be any changes to eligibility determination for federal subsidies? Can states that opt in for 2014, opt out at a later date?
 
Regardless of what CMS says, some state officials have indicated that they will wait until after the November elections to determine what they will do.  That is a gamble. If November brings a Republican sweep and then they gut the law next year, it would pay off.
 
But if the president wins a second term, states will either have less than a year to implement or dig in for a significant confrontation with Washington that may harken back to the Nullification battles in the 1800s.
 
Most states aren’t girding for battle, but many have been waiting for the Court to rule before moving in earnest to create an insurance exchange. Many will likely begin to move. They will also begin to define essential health benefits for plans sold through the exchange.
 
Insurers will continue to try to influence how the exchanges themselves will be designed, while also developing insurance products to be sold through exchanges.
 
Hospitals will brace for Medicare reimbursement cuts totaling more than $150 billion, while at the same time prepare for a huge increase of newly insured patients with pent-up demand for medical services.
 
Other groups will continue to push for changes to the law. Employers face new requirements, rules, and penalties, while medical device companies face a new 2.3% tax beginning next year.
 
The Court’s decision, while significant, is not the end of the discussion over the health reform law. The voters and their representatives will ultimately decide its fate.
 
Merritt has been a health policy adviser to three presidential campaigns.  He is a senior advisor at Leavitt Partners, the healthcare firm led by former HHS Secretary and Utah governor Mike Leavitt.