Wyden And Brown Offer Bill To Allow States To Opt Out Of Reform Sooner

Today, Sen. Ron Wyden (D-OR), along with Scott Brown (R-MA) introduced the “Empowering States to Innovate Act,” moving up the date for when states can opt out of certain requirements under the Affordable Care Act and pursue more innovative ways of expanding access and reducing costs. If adopted, states that demonstrate that they can cover “at least as many citizens with coverage that is at least as comprehensive and affordable as prescribed under federal law,” will be able to exempt themselves from “the individual mandate, the employer penalty for not providing coverage, the exact standards for a basic health insurance policy and the structure of the health insurance exchange” beginning in 2014, rather than the current 2017 requirement.

“I fought to include state waivers in the new health reform law because I have always believed that federal reform shouldn’t constrain a state’s ability to do better,” Wyden explained in a statement released this morning. “Some of the most innovative approaches to health policy have originated at the local level, where lawmakers have a unique insight into their constituents’ lives and the state waiver simply gives states the bandwidth to pursue those kinds of approaches,” Wyden said.

Wyden, Brown and Sen. Bernie Sanders (I-VT), who co-sponsored the original innovative waivers amendment, believe that their home states of Oregon, Massachusetts, and Vermont are leading the pack in adopting innovative approaches — single-payer Vermont or a single-payer proposal recent introduced in Oregon— but it remains unclear how many other states would be able to meet the requirements of the waiver.

Some health policy wonks don’t think it can be done without a mandate. January Angeles, a health policy analyst at the Center on Policy and Budget Priorities, says that Wyden’s waiver does not exempt states from reforming their health insurance markets — extending guaranteed issue and community rating — and claims that “whether or not he gets this waiver, Oregon still has to implement those market reforms.” “There is no way to implement those market reforms” without a mandate, she insists. “There is just no way to make it work and have the popular elements of reform and make it work.”

States would still have to abide by the insurance market reforms in subtitles A, B, and C of the Affordable Care Act and Wyden’s office responded to the criticism this way: “if a state can’t come up with a solution that meets those reforms and all of the other cost and coverage requirements then it won’t qualify for a waiver.” “Senator Wyden wrote the state waiver provision to be purposefully unspecific so that states would be free to innovate new ideas that none of us may have thought of yet,” Wyden’s communications director Jennifer Hoelzer wrote me in email. “And if they can’t make it work as some are suggesting, then they won’t qualify for the waiver.”

Interestingly, Kaiser Health News reported yesterday that Sen. Ben Nelson (D-NE) “has asked the Government Accountability Office to study alternatives to the controversial mandate requiring most Americans to obtain coverage” and may be looking to come out against the mandate ahead of his re-election bid in 2012. Since Wyden has touted his waiver as an alternative to repeal, I asked Nelson’s office why the Senator had not signed on to the amendment. “He’s not at this time,” was all Jake Thompson — Nelson’s Communications Director — told me.