States Could Still Pursue ObamaCare Even If the Law Is Struck Down


The Wall Street Journal reported recently that even if the health law is struck down by the Supreme Court, several states plan to move forward with implementing significant portions of the law anyway:

Officials in Rhode Island, California and Colorado—states where governors are broadly supportive of the law—say they plan to move ahead with their exchanges even if the entire law gets struck down. They added that they expect the law will remain in place, and are working to meet the 2014 deadline to get exchanges up and running.

"You can crystal-ball yourself to death," said Peter Lee, the executive director for the exchange in California. "If the unthinkable became thinkable, there are members of the state legislature, there's an exchange board, there are constituents across the state who would say, 'OK, now's the time to take the next steps.' "

Lawmakers in California have floated the idea of introducing a statewide requirement for individuals to carry insurance or pay a fee. Massachusetts is currently the only state to have this requirement.

The states wouldn't be able to rely on the federal funds afforded by the health law, but as California's flirtation with a Massachusetts-style state-based mandate suggests, they'd probably be able to replicate other parts of it. Indeed, there are no obvious legal barriers to following the Bay State's example in its entirety and enacting a state-based version of ObamaCare. 

Given the experience in Massachusetts, where officials remain deeply concerned about the mounting cost of health care under the law, I'm not sure why any state would choose to pursue that path. The point, however, is that a state that chose to could. This seems to undercut the arguments that the only alternative to ObamaCare is a national single payer system. It also suggests a way to experiment futher with the RomneyCare/ObamaCare approach without forcing on the entire country, which has remained consistently opposed to the law since before its passage. 

ObamaCare's advocates have made a big deal about the supposed flexibility the law gives to the states. But if this is correct, it appears that even without the law in place, states already have the flexibility to institute state-based versions of ObamaCare on their own. Granted, ObamaCare's backers were never serious about providing flexibility to the states (inititially many wanted a single federal exchange), and tended to highlight flexibility mostly as a response to resistance from state governments. But if there was ever any interest in providing real state flexibility, getting rid of the law and letting states decide whether or not to pursue similar reforms would be one way to do it.