Empowering States

States play a critical role in implementing the health reform law. In this Washington Post article, HHS Secretary Kathleen Sebelius writes that states are "in the driver's seat because they often understand their health needs better than anyone else." She goes on to explain how the Affordable Care Act empowers states to implement the law. 

An excerpt of the article is below, and you can read the full article here.

How the Affordable Care Act empowers states

By Kathleen Sebelius

Thursday, February 10, 2011

As governor of Kansas, I saw up close the urgent need for health-care reform. I heard it when factory owners told me their biggest concern was not manufacturing costs but rising insurance premiums, and when families said they felt like hostages to insurance companies that could deny or cancel coverage with little accountability. I saw it in our state budget, where rising health-care costs prevented investments in our future.

The Affordable Care Act puts states in the driver's seat because they often understand their health needs better than anyone else - and that is why it is so frustrating to hear opponents of reform falsely attack the law as "nationalized health care."

The truth is that states aren't just participating in implementation of the law; they're leading it.

Consider the state-based health insurance marketplaces that will be created under the law in 2014. These marketplaces, called exchanges, will allow individuals and small-business owners to pool their purchasing power to negotiate lower rates. They'll also serve as a one-stop shop where insurers must compete to deliver the best deal. Starting in 2014, members of Congress will have to purchase health coverage through these marketplaces as well.

Although the law gives states the option to design and run their own exchanges, some critics have claimed this could burden states if they're not given adequate resources and flexibility.

I agree. But what these critics miss is that the law already gives states most of the resources and flexibility they're asking for.

States have discretion, for example, to offer a wide variety of plans through their exchanges, including those that feature health savings accounts. Utah and Massachusetts already operate exchanges but take very different approaches: Utah allows all insurers to participate; Massachusetts has stricter standards. Under the law, both approaches could work.

States also have the flexibility to decide what benefits plans must offer. They can choose to require basic protections, based on the typical benefits people get through their jobs, or set higher standards.

And states' costs of designing their exchanges will be fully funded by the federal government through 2015, with additional funds available to help determine which residents are eligible.

....The Affordable Care Act gives states incredible freedom to tailor reforms to their needs. The one thing the law does not permit is going back to the broken health insurance system we had a year ago.