Republican Matt Bevin’s dominant victory in Kentucky’s gubernatorial race is a blow for Obamacare, but is probably not as damaging as it seems. Kentucky will become a test case for what happens when a newly elected conservative comes into office after promising to undo the Affordable Care Act’s (ACA) coverage expansions: Bevin is likely to quickly confront the practical and political realities of taking away insurance from 400,000 people. Republicans in DC might learn from either his softening or the ensuing mess following cuts and could well think twice before trying to repeal the ACA nationally.
What Happened
Attorney General Jack Conway (D) led in the most recent polls and was expected to win this race. Kentucky has had a Democratic governor in 40 of the last 44 years. Bevin was not an especially strong candidate, winning the Republican nomination by just 83 votes after being soundly defeated by Mitch McConnell in the 2014 Senate primary.
Obamacare was a major issue throughout the campaign because Kentucky has been the poster child for ACA implementation. Mitt Romney won the state by 22 percentage points in 2012, but it was still the only state in the southeast to build its own exchange and to expand Medicaid. President Obama praised Democratic Governor Steve Beshear during his 2014 State of the Union speech, inviting him to sit in the First Lady’s box.
The launch of Kynect, the state’s exchange website, went smoothly while the federal website healthcare.gov was riddled with problems. The state expanded Medicaid and more than 400,000 people signed up. These factors combined to make Kentucky the state with the second largest decrease in the proportion of residents without insurance, decreasing from 20.4 percent in 2014 to 9 percent in 2015.
However, this progress is particularly vulnerable in Kentucky given how the ACA was implemented by Governor Steve Beshear. He could not convince the legislature to create an exchange or expand Medicaid, so he did both using executive powers. As a result, Bevin does not need a legislative vote or a prolonged fight to undo these core elements of the ACA. He can get rid of them with the stroke of a pen.
This is exactly what Bevin has said he would do. His campaign website calls for immediately “freezing and disbanding” the state’s exchange website, instead transitioning to healthcare.gov. He said early in his campaign that he would reverse the Medicaid expansion immediately.
National Implications
Supporters of the ACA kept a close eye on this election, hoping a Conway victory would support the narrative that opposition to Obamacare is no longer potent. Presidential candidates and members of Congress would see this as a warning and talk less about repealing Obamacare. Supporters hoped for a policy feedback loop in which, as political scientists say, “new policies create a new politics” — in other words, dynamics would be remade as people rewarded leaders who gave them coverage and punished anyone who tried to take it away.
That did not happen. Just as many others did in 2010, 2012, and 2014, a conservative Republican won a local race in a red state by promising to fight Obamacare. Most counties in eastern Kentucky, where the rural population is particularly poor, voted for Bevin. The best these previous leaders could do was refuse to cooperate or to cast symbolic votes saying they would repeal the law if they could. However, Bevin is the first person in a serious position to deliver on this threat.
What Happens Next
The stakes are not so high with the dismantling of the exchange. There are some advantages to running the exchange at the state-level, including the ability to control outreach and to reduce churn by better coordinating with other programs. However, the Supreme Court’s decision in June affirms that people will have access to subsidies regardless of whether they get coverage through an exchange run by the state or federal government.
The consequences of repealing the Medicaid expansion, on the other hand, would be enormous. More than 400,000 people would lose the coverage they had just gained. Kentucky would join the remaining 19 states with a gap in which people are too poor to receive help on the exchange and ironically too well off to qualify for the old Medicaid program.
Bevin has boxed himself into a corner on Medicaid. He has to satisfy the frustration of conservatives who nominated him, but he will face a strong backlash if he follows through with taking away insurance from so many people. Hospitals, providers, and consumers will vigorously protest.
Bevin toned down his language on Medicaid throughout the campaign. He told reporters in July, “I said I would address Medicaid. I didn’t say I would end it.” A recent campaign letter re-emphasized his commitment to repeal Medicaid, though a spokesperson then clarified, “What he has called for is repeal of Obama’s Medicaid expansion by applying to CMS for 1115 waivers.” Republican leaders in places like Arkansas, Iowa, and Michigan have taken a similar approach. This allows them to tell constituents they are reforming rather than implementing Medicaid, even though they are using the ACA’s money.
Lessons From Kentucky
It is too early to draw many conclusions from Kentucky’s gubernatorial election. This result may have more to do with Rowan County Clerk Kim Davis and her efforts against same-sex marriages than with health reform. Even so, the inability of a Democrat to win in a state that saw massive coverage expansions will be interpreted as a warning that it is still too soon to aggressively campaign in support of the law.
These results hint at the persistent disapproval many feel for the ACA. As I have written elsewhere, it is not inevitable that every state ultimately adopt the Medicaid expansion. Republicans will feel renewed vigor in campaigning against the law as a result of Kentucky’s election.
The most important lesson depends on whether newly elected governor Matt Bevin attempts to repeal Kentucky’s Medicaid expansion. If he does and is successful, national Republicans will look to him as a model. Just because there has not been a policy feedback loop yet does not mean there would not be one if he cut coverage. A 2014 survey found that 83 percent of Republicans in Kentucky opposed Obamacare compared to 32 percent who opposed Kynect — obviously many did not realize that Kynect is simply the local name of the state’s version of Obamacare. Governor Bevin could see a strong backlash as people realize that the cuts he campaigned on result in them losing coverage.
Governor Bevin is unlikely to follow through with his threats to drastically cut Medicaid. The evolution of his rhetoric throughout the campaign suggests he has already begun to realize that taking away coverage from 400,000 people is not feasible. National conservatives would learn from this that if it is too complicated to undo Obamacare in one state, it is a mistake to pursue this as a national strategy in 2017.
This is a more nuanced story than supporters of the ACA hoped to be telling after Kentucky’s election. However, it still likely ends with what they would consider a positive outcome: Kentuckians keep their coverage and the ACA’s future remains secure.
from Health Affairs Blog http://ift.tt/1SoQ651
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