Look to the states

PPACA is a federal law, and the media focus has been, and continues to be, on whether Congress will repeal it.  We’ve argued many times that repeal is not likely to occur.  That doesn’t mean there might not be significant changes.  While everyone seems fixated on the federal government, they should also be looking at the states.  From the WSJ:

In Oklahoma, John Doak, a Republican challenger for the elected insurance commissioner’s post, ousted an incumbent Democrat, Kim Holland, in an election that focused heavily on the Republican’s opposition to the federal health-care act. A significant amount of responsibility for implementing the federal program is in the hands of state officials.

In most states, insurance commissioners are appointed by the governor, and with 37 state gubernatorial elections on Tuesday, turnover has already begun to occur; Connecticut Insurance Commissioner Thomas Sullivan, for instance, announced his resignation on Monday.

It’s important to remember that insurance is regulated to a large extent at the state level.  Insurance commissioners are not appointed by the President or by Congress; they are appointed by governors.  And on Tuesday, Republicans picked up nine seats to control 29 states.

Moreover, the exchanges, which still have to be set up, are also state based.  Again, state insurance commissioners will have a lot of power and control to set regulations on how the exchanges will work.  That will make a big difference in how reform functions in the individual insurance market – where most of the uninsured are expected to get insurance.

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