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exchange because federal regu- lations will largely dictate how the exchange operates. “The health care exchange, whether it’s run by the state of Texas or whether it’s run by the federal government, is going to be done under federal law, rules, and regulations, most of which are yet to be deter- mined,” Representative Shelton said. “So I don’t think it mat- ters about the exchange.” Representative King added,



“While it does matter function- ally whether Texas operates the exchange in terms of the day-to-day operations, ulti- mately the governor is correct that once again federal rules and regulations would ultimately dictate how Texas would have to administrator the exchange.” Even if Governor Perry did support a state-run exchange, several lawmakers and TMA officials question whether there is time to implement one before the federal government steps in. Under the law, states have until Jan. 1, 2013, to demonstrate to the federal government that they have an exchange in place and that it will be operational by Jan. 1 2014. Representative Zerwas says it would be “a real stretch” to meet the Jan. 1, 2013, deadline but might be doable if the state acted quickly. “There are some states that have already put together ex- changes and worked out some of the kinks in them,” he said. “There would be the possibility that those charged with putting together the exchange could look to other states, perhaps even look to the private market, and find examples of things that you could put together fairly quickly without having to spend a lot of time.”

But that’s assuming Texas could create an exchange without legislative authorization. The next session of the legislature does not convene until Jan. 8. Darren Whitehurst, TMA vice president for advocacy, says the governor’s office has indicated it has the authority to direct the Texas Department of Insurance or other agencies to imple- ment an exchange by executive order. But even if the governor could or would do so, Representa-

tive Zerwas questioned whether he would act before Novem- ber’s general election. If President Obama fails to wins an- other term, the question might be moot because presumptive Republican presidential nominee Mitt Romney vows to repeal PPACA, if elected. Regardless of who runs the exchange, Texas Health and Human Services Commission (HHSC) officials say they must change their eligibility system to make sure it can interface with the exchange. “The exchanges under the Affordable Care Act are designed to be a front door for not only the subsidies but other health

coverage, too,” said HHSC spokesperson Stephanie Good- man. “That means that the exchange will need to determine if someone might qualify for Medicaid and CHIP [the Children’s Health Insurance Program] and send that information to the state.” For that to work, Ms. Goodman says, PPACA mandated that states move to a consistent method of calculating a family’s income.

She says HHSC is waiting on additional guidance from the Centers for Medicare & Medicaid Services on exactly how that would work.

THE PENALTY OPTION PPACA is supposed to cover an estimated 32 million Ameri- cans, but without the Medicaid expansion in several states, that number is likely to be much lower.

Some TMA officials fear the law will have a negative impact on coverage in other areas.

“My concern would be that some companies that are feeling a financial or economic pinch right now will say ‘I can’t afford paying this premium, I’m going to pay the penalty tax,’” said Dr. Floyd, who served on the Council on Legislation through- out the PPACA debate. The law not only imposes a penalty on individuals who fail to purchase insurance but also on busi- nesses with more than 50 employees that do not provide cover- age for their workers. “So employers are going to pay the penalty and look at the employee and say, ‘Good luck, you’re on your own,’ ” he added. Dr. Floyd also predicts that healthy Texans in their 20s, 30s, and even some in their 40s will pay the penalty each year rather than shell out thousands of dollars annually for insur- ance coverage.

All told, he says, “I’m not sure we’ve helped the uninsured a bit.”

September 2012 TEXAS MEDICINE 17

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