Ezra Klein: Is Texas Governor Rick Perry Going to Shoot Texas in the Head to Prove That ObamaCare Is a Failure?
Ezra Klein thinks he just might…
Will the GOP’s plan to fight Obamacare in the states backfire?: The question, though, is whether governors who purposefully do a very bad job implementing Obamacare will hurt the law, or just themselves and their states. Call it the California v. Texas question. In 2010, Governor Arnold Schwarzenegger of California signed into law two bills to establish the online insurance marketplace — “exchanges” — that are at the center of President Obama’s health-care reform…. California promptly accepted the law’s Medicaid expansion. By this time next year… it’s possible that the portion of the state’s uninsured population will have declined from 20 percent to less than five percent.
In Texas… the Lone Star State isn’t lifting a finger to create an exchange, instead leaving the work to the federal government. Texas is refusing Obamacare’s Medicaid expansion, too. “The idea that we would expand and put more money and more people into a broken system is not unlike putting another 1,000 people on the Titanic,” Republican Gov. Rick Perry told Forbes. “You know how this is going to turn out. And it’s going to be a disaster.” One might observe that the health-care system in Texas, which, has the nation’s highest rate of uninsured residents — 24 percent, or more than six million people — is already a disaster. But the recalcitrance of Perry and Republican state lawmakers has the potential to make it much worse.
In the case of state exchanges, the federal government can step in to build them, though it will be a heavier lift than the administration ever imagined…. For the feds, there are certain economies of scale in setting up the exchanges. But many of the tasks… would be much easier with state cooperation. Unlike the exchanges, however, there is no fallback if a state refuses to expand Medicaid, which covers the poorest Americans. But that refusal will come at a tremendous cost to the state’s hospitals…. Although Texas can legally refuse the Medicaid expansion, it can’t opt out of the subsidies provided to encourage participation on the exchanges. So while a Texan making $13,000 might get no help with her health insurance, one making $23,000 might get the whole tab picked up by the feds. The possibilities for confusion — and, once the situation becomes clear, anger — are both obvious and immense.
Moreover, because Medicaid’s expansion was conceived in part as a new source of revenue for hospitals, Obamacare ratchets back payments — called “disproportionate share payment…. that the federal government currently makes to providers who treat the uninsured. Texas… received almost $1 billion in DSH payments in 2011… Republican governors, including Ohio’s John Kasich and New Jersey’s Chris Christie… are more afraid of seeing their hospitals close than of being criticized for cooperating with Obama. But in states like Texas, hospitals won’t get the new Medicaid money and they won’t get the old DHS payments….
The law’s opponents hope this sort of truculence will harm Obamacare — and it probably will. But it will do so primarily by harming the resisting states’ health-care systems. It’s a classic example of cutting off your nose to spite Obama. And because the law can vary so much state-by-state, the dysfunction in states that fight the law will probably stand out compared with states that genuinely work to implement it effectively….
California might end 2014 with a high-performing, near-universal health-care system. Texas might end it having made an already troubled system even more of a disaster. Will that reflect on Obamacare, which is working just fine in a neighboring state? Or will it reflect on the Republicans who govern Texas? That’s the key political question. It’s a tried-and-true strategy to regain power by exploiting the rival party’s governing failures. It’s a bit riskier to try to mount a comeback it by exploiting your own governing failures.
