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President Obama's second term in office began on Inauguration Day, January 21st, and the list of policy challenges facing his administration is daunting. Aside from the difficult task of addressing the nation's economic woes, the president and his administration will also deal with the increasing complexities of global climate change, a rapidly changing energy market, entitlement and tax reform, healthcare reform, and the repercussions from the still simmering "Arab Spring." Throughout this month, we will solicit the viewpoints of a variety of HKS faculty members to provide a range of perspectives on the promise and pitfalls of The Second Term.
We spoke with Robert Blendon, Professor of Health Policy and Political Analysis at the School of Public Health and faculty member of HKS, about the Affordable Care Act and its challenges on the president's radar screen.
Q: What healthcare policy priorities should be atop the president’s agenda in his second term?
A: The election is now over and there is no longer an immediate legislative threat to repealing the Affordable Care Act. But to the surprise of many in the policy community, the debate over the future size and scope of this major piece of healthcare legislation continues. Within the last few weeks, the majority of state governors have indicated an unwillingness to move ahead with state-managed health insurance exchanges, leaving the federal government to take on this task. Also, many have announced that they will not move ahead with expanding their current Medicaid programs due to perceived concerns about the long-term fiscal impact on their state budgets. In many states almost half the uninsured who were to be covered by the ACA were to receive Medicaid. Thus the near-universal nature of this national insurance legislation remains at risk unless these states change their positions and move forward with the Medicaid expansion.
Q: What is the potential blowback if these states don’t come on board soon?
A: It is quite possible that if these uncertainties are not resolved this will become a major issue in the next Congressional elections 23 months from now. Opponents of the ACA seeking Congressional office in this election will argue that the legislation needs to be scaled back because of its failed implementation just when the major expansions in coverage are to start moving ahead. The Obama Administration has to focus on these issues if they do not want these criticisms to become a political liability.
Q: How can and should the administration work to overcome the serious challenges standing in the way of the full implementation of the ACA?
A: First, they have to work with eight to ten states where the political environment is supportive and move quickly to enroll uninsured individuals in each state and have a working and functioning state insurance exchange. This has to be seen as workable by small business and their employees. Low enrollment in the exchanges will be seen as a sign of the unworkability of the concept. This program can no longer claim it will be a success based solely on the Massachusetts experience. States like California, Illinois, New York, Maryland, and Washington need to be seen as the 2014 poster children for this effort.
Second, in the effort to resolve the “fiscal cliff” debate and the subsequent conflict over raising the national debt limit in the near-term future, the Administration cannot lose the generous national formulas for state Medicaid expansions now in the current legislation nor reduce the existing federal match for state Medicaid enrollees. If this happens, the promise of near-universal coverage will be illusionary. Also, regardless of the confident statements being made by the Administration of potential ease of the federal government implementing federal exchanges in non-participating states, the reality is that the task is quite daunting.
Q: What lessons from history can the administration draw upon in order to overcome the current challenges to the ACA?
A: The Massachusetts lesson suggests high administrative costs to launch these efforts, the need for substantial cooperation from civic leadership and the requirement of extensive outreach educational efforts. If the resources for this unanticipated federal exchange activity in the ACA are lost in the various budget agreements, the implementation in these non-participating states will be limited and provide a backdrop for the political challenges in 2014. Public information campaigns will matter less in this phase and the reality of the facts on the ground in states will determine how politicians and the media assess this legislation in 2014.