The Obama Administration’s Sneaky Plan To Hook Republican States On Obamacare

CREDIT: Jessica Rinaldi/Reuters

Obamacare enrollment

CREDIT: Jessica Rinaldi/Reuters

With just 25 days left until uninsured Americans can begin signing-up for health care coverage under the Affordable Care Act, Republican lawmakers and Tea Party groups are doing their best to impede the enrollment process.

But the Obama administration is ignoring the noise coming out of DC.

Instead, officials at Department of Health and Human Services are trying to leverage reluctant Republican governors who have refused to establish state exchanges or expand their Medicaid programs into accepting a small part of the law, with the hopes that it will put them on the road to full implementation.

On Friday, the Obama administration announced that it had reached an agreement with Oklahoma that would permit that state to continue using federal Medicaid dollars to subsidize private health insurance for low-income workers and require some individuals to find coverage in the ACA’s health care exchange. For Oklahoma Gov. Mary Fallin (R), the deal represents at least a partial embrace of reform and provides some low-income residents with more affordable coverage.

Since 1996, Oklahoma has provided private insurance to low-income individuals who would not have otherwise qualified for Medicaid though a special federal waiver. The program, called Insure Oklahoma, would have expired on Dec. 31, after Oklahoma refused to comply with the ACA and expand Medicaid to 133 percent of the federal poverty line (FPL).

Under the new one-year agreement negotiated by the Obama administration, individuals with incomes at or below 100 percent of the FPL would maintain their existing private coverage. But Oklahomans with incomes between 100 and 200 percent of the FPL — who had been receiving insurance through Insure Oklahoma — will now begin enrolling in the state exchange, where they would receive more comprehensive policies and federal subsidies.

Obama administration officials hope that the state will fully implement the requirements of the law and expand its Medicaid program once the waiver expires. If it fails to do so, thousands of low-income Oklahomans will lose their insurance.

The same will happen in Indiana. On Tuesday, the Hoosier state received a one-year extension of its pilot Medicaid program, which provides coverage for low-income residents, but “does not cover all the services that Medicaid does” and forces cost-sharing from recipients. The agreement also requires individuals earning between 100 percent and 200 percent of poverty to enroll in the Obamacare exchange, where they can qualify for subsidies and find more affordable coverage.

Indiana Gov. Mike Pence (R) “has said he will consider expanding Medicaid” as part of the deal and the federal government is arguing that the state will save billions of dollars through higher federal contributions and experience large reductions in its uninsured population if it accepts the full Medicaid expansion. Similar federal waivers are pending for Arkansas and Iowa, and a group in Ohio is working to put Medicaid expansion on the ballot.

Administration officials specifically included reform provisions in their waiver expansion agreements because they believed that once red states get a small taste of the health care law — and low-income residents begin receiving more affordable coverage in the exchange — conservative governors will swallow the whole thing.

“We look forward to working with Oklahoma and all other states in bringing a flexible, state-based approach to Medicaid coverage expansion and encourage the state to explore these options,” a CMS spokesperson told ThinkProgress. “We encourage all states to adopt the Medicaid funding made possible by the Affordable Care Act.”