Health care checkup: State legislation, Supreme Court case prompt question about Nevada’s exchange

By Kyle Roerink

Published Wednesday, March 11, 2015 | 2 a.m.

Updated Wednesday, March 11, 2015 | 11:13 a.m.

With the Affordable Care Act still under a full-scale assault from detractors on both the national and state level, the future of the law is uncertain for Nevadans and the rest of the nation.

Last week, the Supreme Court heard opening arguments in a Republican-backed repeal case, King v. Burwell. Obamacare critics in Congress continue to hammer away as well, as the U.S. House of Representatives cast its 56th repeal vote in February. And closer to home, one GOP assemblyman is sponsoring a bill to repeal the state’s law facilitating the ACA in Nevada.

The efforts point to the nation’s widening divide on the health care law and keep one simple question alive for Nevadans who signed up for plans with federal subsidies: Will partisan politics nullify plans purchased on Nevada’s Silver State Exchange, the state-run health insurance marketplace?

The Supreme Court case addresses federal subsidies in at least 27 states and definitions of state-based and federal exchanges. Plaintiffs say the law is limited to providing subsidies to state-based exchanges — of which there are 13 — while defendants say it applies to federal and state exchanges

For most of the country. there is a clear distinction between the two types. But Nevada and two other states — New Mexico and Oregon — fall into a gray area no one predicted when Congress passed the health care law in May 2010.

Nevada’s uncertainty results from a disastrous rollout of its state-run exchange two years ago. The state acted independently of healthcare.gov, the federal system, for selling subsidized plans. But glitches in payment and billing software built by tech contractor Xerox forced officials to ask the federal government for help.

The state determined that decoupling from Xerox and plugging into healthcare.gov was the best solution. Nevada still uses state infrastructure to pick health care plans, work in communities and advertise for the exchange. But, as defined by the federal government, it is a state-based exchange that is one of 37 states using healthcare.gov.

That symbiotic relationship with healthcare.gov may have Supreme Court justices and federal officials paying special attention to Nevada in the next round of deliberation.

“What may distinguish us is that since the state became part of the federal platform, the federal government may say: Nevada, you’re part of us. Is that going to make any difference? It depends on King v. Burwell,” said James Wadhams, a lobbyist for Fennemore Craig Jones Vargas and former state insurance commissioner.

If the court rules that the subsidies are only available in pure, state-based exchanges, Nevada consumers could be in jeopardy of losing funding. But Wadhams said Congress would likely adopt a correction.

“No politician of any stripe won’t vote on that. Once they put chickens in your pot, they’re not going to take them back out.”

In the latest sign-up period, more than 8 million Americans enrolled in subsidized health insurance plans created by the ACA. Of those, around 74,000 Nevadans enrolled.

Bruce Gilbert, executive director of the Silver State Exchange, isn’t worried about Nevada consumers losing insurance.

“We meet all the requirements that allow us to continue offering subsidies whatever the decision in King v. Burwell,” he said.

Republican Gov. Brian Sandoval discussed the case with Sylvia Burwell, the U.S. Health and Human Services secretary, two weeks ago. The talk left state officials confident that Nevadans who have health insurance subsidies won’t lose them if the Supreme Court determines some subsidies to be unconstitutional.

“The governor feels confident that we are in the right place,” said Mike Willden, Sandoval’s chief of staff.

Other Republicans feel differently about the current situation.

Assemblyman Brent Jones, R-Las Vegas, called Nevada’s new relationship with the federal government “a waste of valuable dollars in tight times.”

He’s sponsoring a bill that would eliminate the Silver State Exchange, leaving Nevada to solely rely on the federal system.

Jones pointed to the money the state spends on billboards, TV ads, outreach centers and other efforts to enroll consumers into health insurance plans.

By the end of the year, the state will have authorized at least $14 million on advertising and outreach.

“Why spend all the resources to promote it when the federal government can do it all?” he said.

Jones’ legislation is a long shot to pass but serves as an emblem of nationwide frustration with the ACA. Lawmakers and citizens still criticize how the bill passed in Congress and slam the initial rollouts — in Nevada and nationwide — two years ago. There have been dozens of exemptions and delays for employers and consumers the Obama administration ordered, feeding into the GOP-backed narrative the law would kill jobs and hurt the economy.

Since the federal law’s inception, GOP lawmakers and elected officials have campaigned in opposition to the health care law at the state and federal level — with many panning it as socialist system in opposition to a laissez faire marketplace. Lt. Gov. Mark Hutchison worked pro-bono on a court case aiming to dismantle the law, which he touted on the campaign trail. U.S. House Speaker John Boehner predicted the law would spark an economic meltdown.

“It’s a one-size-fits-all policy,” Jones said. “I believe free markets give the most efficient return on resources.”

CORRECTION: This story has been updated to correctly reflect the federal government’s definition of Nevada’s exchange. It is a state-based exchange that uses healthcare.gov. | (March 11, 2015)