Wisconsin's health-care fight illustrates challenges as states change leadership

Wisconsin Gov. Scott Walker talks about the budget bill during an interview in his office at the Capitol in Madison, Wis. on Friday.
Wisconsin Gov. Scott Walker talks about the budget bill during an interview in his office at the Capitol in Madison, Wis. on Friday. (AP)
By Amy Goldstein
Sunday, March 20, 2011; 11:48 AM

MADISON, WIS. - Two weeks after President Obama signed the nation's health-care overhaul into law, then-Wisconsin Gov. Jim Doyle (D) issued an executive order creating an Office of Health Care Reform.

Over the next eight months, the Badger State made more headway than virtually anywhere else in the country at preparing to carry the statute out. It designed - and presented at the White House - the country's only prototype for how people and small businesses could navigate a new health insurance marketplace online. It produced a 205-page blueprint envisioning that marketplace as a "transformative force," steering people toward care of high quality and low cost.

Then, in late January, Doyle's Republican successor, Scott Walker, issued his own executive order, dissolving the health reform office and replacing it with the Office of Free Market Health Care.

"We view this as a fundamentally different approach than what the past [Wisconsin] administration was doing - and what . . . the Obama administration is pushing," Walker said in the first interview he has given about health-care reform since assuming office.

Wisconsin's U-turn, as sharp as anywhere in the country, illustrates how the views of state leaders are shaping the way the health-care overhaul envisioned by Congress will work on the ground. It illustrates, too, the treacherous terrain the Obama administration and congressional Democrats are walking by entrusting states to carry out major parts of the plan now that 29 governors are Republicans, including 18 who - like Walker - have taken office this winter. In Wisconsin, as in five other states, both chambers of the legislature also have just switched to GOP control.

"We've gone from one kind of boldness to another," said Robert Kraig, executive director of Citizen Action of Wisconsin and a leading liberal activist on health care in this university town with its granite-domed state Capitol.

But being dead set against the health law is not proving to be a simple matter of saying no to everything it contains. The new opposition is subtler but no less profound - a process of picking and choosing provisions to embrace or reject, of taking some grants offered by the federal government while spurning others, of striving to kill the law in Congress or the courts while preparing a conservative alternative.

Walker, best known for his effort to demolish rights to collective bargaining for government employees, thinks that the health-care statute is unconstitutional and that the government has no business influencing people's health-care choices. Doyle's aides estimated that the law would save Wisconsin $850 million by the end of the decade; Walker's estimate that it would cost $433 million.

Where Wisconsin is coming from

With states required by 2014 to carry out the law's core features - among them, widening access to private and public insurance - Wisconsin is in a more auspicious starting place than most. Just 6 percent of its residents lack health coverage, the second-lowest proportion in the country. And over the years, Wisconsin repeatedly has expanded Medicaid, called BadgerCare here, so that an unusually large share of people already has public insurance.

Those distinctions are part of the Walker administration's justification for resisting federal requirements. "Wisconsin . . . already has accomplished much of what [the law] aspires to do," said Dennis G. Smith, the new secretary of the state's Department of Health Services.

Smith, the driving force behind Wisconsin's about-face, arrived from Washington in January with a reputation as a mild-mannered, highly conservative thinker on health policy. Under President George W. Bush, he was in charge of Medicaid at the U.S. Department of Health and Human Services. More recently, he was at the Heritage Foundation, writing criticisms of the new federal law. He said in an interview that he did not have ties to Wisconsin or know Walker before mutual acquaintances, including Rep. Paul Ryan (R-Wis.), chairman of the House Budget Committee, suggested to both men that they should talk.

In a primary example of obeying the law selectively, Walker and Smith said they will create, as the statute envisions, one or more marketplaces called exchanges to help individuals and small businesses buy insurance. But the exchanges will not do everything the law says. "We believe it's got to be free-market driven, not government driven," Walker said.

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