As Maryland goes full steam ahead on health reform law, Virginia takes pragmatic path

One day after President Obama signed federal health-care legislation into law, Maryland Gov. Martin O’Malley (D) issued an executive order that essentially put out the welcome mat.

He was a lollygagger compared with Virginia Attorney General Ken Cuccinelli II (R). Five minutes after Obama put pen to bill, Cuccinelli’s aides were heading to the courthouse to file his first-in-the-nation lawsuit challenging the law.

Maryland and Virginia were both out front — in very different ways — when the health-care overhaul became law in March 2010. The two states continue to approach the law in their distinct fashions in advance of its full implementation in January 2014 and in the face of doubts about whether it will survive Supreme Court review. But Maryland and Virginia are no longer at opposite ends of the Patient Protection and Affordable Care Act spectrum.

Although deep-blue Maryland remains a leader among states enthusiastically preparing for the health-care overhaul, Republican-led Virginia is no longer the standard-bearer for “Obamacare” recalcitrance. Unlike some other states opposed to the law, whose elected officials are proudly doing little or nothing to get ready, Virginia has been grudgingly but diligently laying the foundation for a law that it hopes will go away.

“We know the [Virginia] governor has very significant concerns about the law, and the governor’s not been shy about expressing that, but at the same time [he] is making sure that, at the very least, they’re prepared to move if they need to,” said Andrew D. Hyman, senior program officer with the Robert Wood Johnson Foundation, which has provided technical assistance to both states.

That nuanced approach may have less to do with Virginia’s purple political identity than with a practical realization on the part of Republicans controlling state government: If the law stands, failing to plan would give Washington even more sway over the state.

Given Virginia’s litigious initial response to the law, some might expect it to be in league with such states as Florida and Texas, which have resolutely declined to pave the way. Joshua M. Sharfstein, Maryland’s secretary of health and mental hygiene, saw that stance on display at a national conference.

“At one point,” Sharfstein said, “a person from Florida got up and said something to the effect of, ‘I’m now going to tell you everything Florida is doing to establish an [insurance] exchange for the Affordable Care Act.’ Pause. ‘Thank you very much.’ ”

But Virginia, whose lawsuit was tossed out and, therefore, is not party to the challenge before the Supreme Court, has taken a more pragmatic approach — one that health policy experts say puts it in the middle of the pack among the states. Even as he praised Cuccinelli’s lawsuit, Virginia Gov. Robert F. McDonnell (R) appointed an advisory council in 2010 to consider whether the state should come up with its own framework for implementing the law or take whatever Washington might hand down.

“It took about 11 seconds that first meeting. No one thought allowing the feds to run it was a good idea,” said a participant, who spoke on the condition of anonymity to discuss the matter freely. “That helped make it clear that doing nothing was actually counterproductive to the shared goal of finding out what’s best for Virginia. That’s why the momentum is actually strong and deep and surprising . . . [to] people who just pick up the paper every six months and listened to Cuccinelli’s press releases.”

That is not to say Virginia has been full steam ahead on the health-care overhaul. To see that sort of response, you might look to the commonwealth’s next-door neighbor and political mirror image.

Maryland has already created its health-benefits exchange, the marketplace for buying private insurance and applying for the expanded Medicaid coverage provided for under the law. Last summer, Maryland became the first state in the nation to hire a director for its exchange, Rebecca Pearce. Now she has several employees.

“They’re as far along as hiring personnel, leasing office space,” said Maryland Lt. Gov. Anthony G. Brown (D), who has helped lead the effort. “In so many ways, it is taking on the form of a real, vibrant agency.”

Virginia hits the brakes

Some thought that Virginia was on the same track, as McDonnell’s advisory council exhaustively studied how best to structure an exchange. It came up with a raft of recommendations on issues broad and granular. But the General Assembly balked this year at creating an exchange. McDonnell and other Republicans contended that there was no reason to move ahead until the outcome of the Supreme Court case is known. A ruling is expected next month.

McDonnell’s stance took some by surprise. Some thought that McDonnell, often mentioned as a potential vice presidential pick, feared that moving ahead on an exchange could be misinterpreted as a tacit endorsement of the health-care law, particularly as a more conservative band of Republicans gained influence in Richmond in November’s elections.

“The governor’s an evidence-based conservative Republican; some people who are not so nuanced, some of them got power,” the advisory council participant said. “He had to kind of tack a little bit.”

O’Malley could trumpet every bit of progress and federal funding for political points in Maryland, the participant said, but McDonnell had to find ways to prepare without seeming to grease the skids for Obamacare.

Their disparate approaches can be seen in a tale of two IT systems. Maryland and Virginia both have decades-old computer systems for enrolling citizens for Medicaid, fuel assistance, food stamps and other social services. Before eligibility is determined, applicants must go to an office and submit information to an employee, who enters the data and in some cases passes the data — on paper — along to other offices. “Legacy systems” is one way those procedures are described. “Dinosaurs” is another.

IT upgrades

With the health-care law about to require both states to enroll hundreds of thousands of people for private insurance or expanded Medicaid benefits — 350,000 in Maryland’s case, 500,000 in Virginia’s — the antiquated IT had to go.

Using federal funds, Maryland hired a contractor in March to start designing a $51.4 million computer system that will allow people to determine their own eligibility and enroll themselves for health-care coverage online. The state intends to upgrade the system later so it can be used to enroll residents in other social service programs.

Virginia’s IT upgrade is the complete inverse. Built with $33 million in federal and state money, the new system’s primary purpose is to enable people to apply online for existing benefits such as Medicaid, fuel assistance and food stamps. The plan is to back into Obamacare enrollment, adding that function to the system only if it’s needed.

“If the health-reform law went away, we would still have a good investment,” said William A. Hazel Jr., Virginia’s secretary of health and human resources.

Maryland officials proudly point out that they have not spent state money on their preparations. They have received $52 million in federal grant money, most of that devoted to the IT project, which will be paid for in stages.

Virginia leaders note just as proudly that they have accepted only a single $1 million federal planning grant, which every state but Alaska took. Only one Virginia state employee devotes all of her time to compliance with the law, and the appointment was made so recently that Molly Huffstetler is still crossing out “Senior Policy Adviser” on her business card and writing in “Deputy Director, Virginia Health Reform Initiative.”

“The leadership in Maryland is working very quickly to implement the law and get an exchange running,” Hyman said. “But there are different politics in Virginia, and in the face of those politics, I think the governor and [health] secretary have acted responsibly. . . . That will, I think, position them well once, and if, the state determines that health reform is inevitable.”

Laura Vozzella covers Virginia politics for The Washington Post.
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