[TheMercenary]

Imagine that....

The Washington Post reports that about a third of states have not made much progress in setting up ObamaCare's state-based health exchanges, but doesn't note that several, including Florida, Louisiana, and Kansas, have already made it clear that they won't set up exchanges at all. That's not an insignificant consideration, because, as The Post explains, the health insurance exchanges are kind of a big deal:

State-based exchanges are crucial to achieving the law’s goal of vastly expanding access to health insurance. They will be open to an estimated 24 million Americans for whom health plans have been particularly expensive — those who buy coverage on their own or as employees of a small business. The exchanges are intended to control costs by creating a larger pool of customers and allowing them to comparison shop. Many customers will also qualify for federal subsidies.

If a state is unwilling or unable to run an exchange, the federal government can step in. But the prospect of taking over exchanges in multiple states could prove logistically and politically unpalatable for the Obama administration.

It's a political challenge because if a state decides it doesn't want to participate in ObamaCare, it will be hard to avoid the (accurate) appearance that the federal government will be effectively taking over the state's individual health insurance market (the health exchanges are expected to become the hub for essentially all individual health insurance policy purchases). Indeed, the Post report accepts this notion when it says that "technically, states have until Jan. 1, 2013, to demonstrate enough progress to avoid a federal takeover."

Logistically, setting up the health insurance exchanges is going to be a pain in the neck for anyone, especially when it comes to making determinations about which individuals qualify for new health insurance subsidies. But the Department of Health and Human Services faces a slew of potential difficulties that are specific to the federal exchances. For example, there's the minor problem that there isn't any money set aside to set up the federal exchanges. Also, the way the law is written, it only allows its insurance subsidies to go to people who purchase insurance through state-run exchanges. Needless to say, that would only compound the political problems: The states that opposed ObamaCare the most would not only end up with federally run exchanges, they'd end up stuck with a mandate to purchase health insurance—health insurance that's projected to rise in cost following ObamaCare—but none of the subsidies designed to ease the pain of the mandate.

http://reason.com/blog/2011/09/12/tr...=Google+Reader