Christine Ferguson

If you care about public policy in Rhode Island, there’s one article you have to read this week: “36 Hours Behind Rhode Island’s Health Exchange,” a new Governing magazine story by staff writer Dylan Scott.

The centerpiece of President Obama’s Affordable Care Act are the new health-insurance exchanges, online marketplaces where residents will be able to comparison shop for coverage and access federal subsidies to help them pay premiums. It’s modeled on the Massachusetts Health Connector, which was set up in 2006 by the Romney administration.

Rhode Island is one of 17 states that are setting up their own exchanges as the law’s architects intended, and the state has $65 million to get it up and running. Now the staff is scrambling to prepare for the Oct. 1 start of enrollment on the exchanges, as Scott explains:

Everybody around here, most of whom have spent some time in the private sector, emphasizes how creating the exchange, which centers on launching a complex yet functional and usable website, is more like working at a commercial start-up. This isn’t some entitlement program with automatic eligibility and a strict set of benefits. Dharma Yechuri, a private consultant who came from Blue Cross/Blue Shield in North Carolina, explains that the whole enterprise boils down to getting a segment of state government to think like “a product-centered business.”

Ian Lang, the exchange’s director for marketing and communications, puts it another way: “We’re asking people to change their buying habits. We’re asking them to buy this product.” In many ways, that’s a totally new role for government.

As we discussed when exchange chief Christine Ferguson appeared on Newsmakers recently, it’s an open question whether Rhode Island was right to create its own exchange rather than, say, try to join the Massachusetts Connector or create a regional grouping. (RIPEC looked at some of the questions in this study.) But now that the path has been chosen, it matters whether the people in charge get it right, particularly since health care is one of the few bright spots left in the Rhode Island economy.

Read the full story here.

The federal government is poised to shower billions of dollars on Rhode Island’s health providers over the next decade due to the looming expansion of Medicaid under President Obama’s Affordable Care Act.

The health law expands Medicaid, the joint federal-state health insurance program for the poor, to cover childless adults who make up to 138% of the federal poverty level, currently $15,856. A new study by the Rhode Island Public Expenditure Council projects that roughly 40,000 more Rhode Islanders will sign up for the program between the start of the expansion on Jan. 1, 2014, and the end of 2023.

Yet Rhode Island taxpayers will need to spend just $450 million in local matching funds to get $3.15 billion in federal money (seven times as much) to cover the newly enrolled 40,000, according to RIPEC. That’s thanks to the extremely generous terms of the Medicaid expansion: the federal government will pay at least 90% of the cost for patients added under Obamacare, compared with only 51% for the current members.

Rhode Island’s Medicaid program spent $1.8 billion in federal and state dollars to cover 224,000 people during the 2010-11 fiscal year. Medicaid accounts for roughly a quarter of Rhode Island’s entire state budget.

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U.S. Sens. Jack Reed and Sheldon Whitehouse were among the 79 senators who voted Thursday night to get rid of a tax on sales of medical devices passed in 2010 to help fund President Obama’s health reform law.

The two Rhode Island senators joined 31 of their fellow Democrats and all 45 Republicans in voting to repeal the 2.3% excise tax on medical devices, which took effect Jan. 1. Getting rid of it would cost the federal government $29 billion from 2013 to 2022, according to the Center on Budget and Policy Priorities, a left-leaning Washington think-tank that opposed repealing it.

Whitehouse and another stalwart liberal, Massachusetts Sen. Elizabeth Warren, were among those who sided with the device industry on the repeal measure, which was introduced by Republican Orrin Hatch of Utah and has been the subject of a heavy lobbying effort.

Stephen Lane, chairman and chief venture officer of the Providence-based medical-device firm Ximedica, said at a manufacturing forum last year co-hosted by Congressmen David Cicilline and Jim Langevin that the tax was causing his industry to move production to Asia. Cicilline and Langevin voted to keep the tax, and Cicilline clashed over the question with his Republican opponent Brendan Doherty in a WPRI 12 debate last fall.

Rhode Island is one of the few states that could wind up spending more money on health care once President Obama’s health care law is fully implemented instead of reaping savings.

The key question: how much will the new law reduce uncompensated care at Rhode Island hospitals?

With a 50% decline in the cost of uncompensated care, the Affordable Care Act would reduce state-level spending on health care by $64 billion between 2014 and 2019; with a smaller decline of 25%, state-level spending would actually rise by $44 billion, according to an Urban Institute study [pdf].

Rhode Island “would see increased costs under the low scenario and reduced costs under the high scenarios, with the magnitude of savings under the high scenario being greater than … the additional costs under the low scenario,” the study’s authors explained.

Federal spending on health care in Rhode Island over the five-year period will increase by an estimated $1.96 billion to $2.12 billion depending on the scenario, including nearly $962 million for subsidies to residents who buy coverage through the new health insurance exchange, according to the study.

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There may be no bigger health wonk in Rhode Island politics than Lt. Gov. Elizabeth Roberts. Now in her second term, the Democrat was tasked by Governor Chafee shortly after he took office with overseeing the state implementation of the federal health care law, and she’s moved quickly to do so.

After this morning’s U.S. Supreme Court ruling upholding the health law, I sat down with the lieutenant governor in her State House office to discuss what comes next. The transcript has been lightly edited for length and clarity.

This decision just says, OK, Rhode Island, keep doing what you’re doing with implementing the health care law, right?

It says keep doing what we’re doing and with a sense of confidence that the federal government is going to be our partner in this going forward. We also have a lot of regional conversations going on, and there’ll be more consistency from state to state – we now know that as a country we are moving forward with this law. That will change a lot of the politics, and also a lot of the practical work that we’re doing.

Take me through – at 30,000 feet – the big benchmarks and milestones ahead in implementing the law for Rhode Island.

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The justices are expected to release their opinion shortly after 10 a.m. This post from Monday will get you up to speed. Lt. Gov. Elizabeth Roberts, who’s leading the health law’s implementation in Rhode Island, will discuss what the outcome means for the state at an 11:30 a.m. news conference.

Update: The law stands, for the most part, as a number of experts predicted.

“The bottom line,” SCOTUSblog writes, “the entire ACA is upheld, with the exception that the federal government’s power to terminate states’ Medicaid funds is narrowly read.” Much more to come.

The issue of the Medicaid funds is one that matters locally, since it affects what the federal government can and can’t do to Rhode Island’s budget. But for now, looks like implementation of Obamacare moves ahead.

Update #2: The Medicaid is apparently largely irrelevant to Rhode Island because our current leaders support expanding Medicaid and weren’t looking to buck the feds on it.

Coming up this afternoon, I’ll have a one-on-one with Lt. Gov. Roberts about what this means for Rhode Island, Christine Ferguson’s reflections on John Chafee’s framework getting upheld, and more on what happens next. Also catch my interview with Congressman Langevin on WPRI 12 at 5:30 p.m.

Heads up – the U.S. Supreme Court could decide as soon as today whether all or part of the Patient Protection and Affordable Care Act, President Obama’s health care law, is unconstitutional.

The justices are scheduled to release opinions at 10 a.m. this morning, but they could hold off on issuing their health care ruling until later in the week. (No TV cameras and no leaks.)

If you want to understand what Obamacare does and what the justices are considering, read Sarah Kliff’s Wonkblog overview. If you want to watch today’s decisions as they come in, follow SCOTUSblog’s live blog this morning.

And if you want coverage on the Affordable Care Act and Rhode Island – which has moved faster than most other states to implement the law – here are some highlights from the Nesi’s Notes archive:

• John Chafee’s ghost haunts high court debate over Obamacare (June 18)

• How RI could become an island of ‘Obamacare’ in Romney’s US (Jan. 19)

• RI awarded $64.8M, most in the US, to start its health exchange (Jan. 18)

• Watch ‘Newsmakers’ with Lt. Gov. Elizabeth Roberts on health care (Jan. 1)

• Health insurance exchanges a bipartisan affair in Rhode Island (April 1, 2011)

• How John Chafee paved the way for ‘Obamacare’ in the 1990s (March 23, 2011)

• Talking health care reform with Lieutenant Governor Roberts (Sept. 23, 2010)

Update: No health care decision today (though there were some other big ones). NYT’s Jeff Zeleny says the Obamacare ruling is “likely Thursday.”

The health care system will still be in need of major changes even if the nation’s highest court throws out President Obama’s 2010 law, CVS Caremark CEO Larry Merlo told Barron’s magazine in a recent interview.

“No matter how Obamacare plays out, no matter how the Supreme Court rules, we have a health-care system that is weighed down by escalating costs, and that has to be addressed,” Merlo said. “Health-care represents about 18% of GDP. We are going to see some type of health-care reform that deals with three things: access, quality, and cost.”

Merlo’s comments were included in a glowing profile of the CVS CEO, who took the helm at Rhode Island’s largest company in March 2011. Barron’s reporter Lawrence C. Strauss, who’s written nice things about CVS and Hasbro before, describes CVS as “a $107 billion colossus” that’s now on an upswing and poised to keep growing.

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No state has moved faster than Rhode Island to grab the federal money available under President Obama’s 2010 heath-care law. Washington has awarded Rhode Island $64.8 million, the most in the country, to get the new insurance exchanges up and running by 2014.

Apparently the state has been less energetic in taking action to get local health insurers to comply with the law’s new regulations. A Commonwealth Fund study out Thursday lists Rhode Island as one of 11 states where ”regulators were actively reviewing insurer filings for compliance with the reforms even though the state had not otherwise passed a new law or issued new regulations or other guidance.”

Every state except Arizona has taken some action to push insurers to implement 10 of the law’s major changes, such as the ban on lifetime benefit limits and the extension of dependent coverage for Americans up to age 26. The Commonwealth Fund put Rhode Island in the lowest of four levels of action states have taken.

But that isn’t necessarily a problem. “States have adopted a range of pragmatic approaches to help ensure that their residents receive the full benefits of the consumer protections promised under the Affordable Care Act,” Katie Keith of Georgetown University’s Center on Health Insurance Reforms said in a news release.

• Related: How Rhode Island could become an island of ‘Obamacare’ in Romney’s US (Jan. 19)

(map: Commonwealth Fund, via Wonkblog)