Angoff: Medicaid expansion "great deal" for states

The health exchange system is scheduled to be launched Jan. 1, 2014, under a key provision of PPACA.

Angoff agreed. He also said that, unlike news reports, HHS expected that most states would rely on federal, rather than state exchanges.

"During the three years I was at the agency, we always assumed that a large number of states would opt-in to the federal exchanges," Angoff said. "This is not a surprise," he said. "HHS has the expertise to implement the exchange system."

Angoff appeared to believe it was bizarre that more states didn't take the money HHS provided, billions of dollars, to implement their own exchanges. 

He said the money for the states was appropriated funds, but HHS had to fund the technology, both hardware and software, to create federal exchanges out of its own appropriations," Angoff said.

"It would have been great if there was a designated stream of funding for HHS to establish exchanges," Angoff said.

But, he said, HHS has the resources to ensure that the exchanges are up and running by the Oct. 1 deadline.

"HHS has the means to do it and they will do it," he said. "The marginal cost of adding one more state to the fed exchange once the technology, the template work, has been completed."

Keiser said that under the law, states can go back to create their own exchanges as of 2017, but it makes little sense to do it, for a host of reasons.

Both noted that as of 2015, the exchanges have to be self-supporting, which means that states that want to go back in 2017 to establish their own exchanges after opting out the first time have to pay for it themselves.

"[Keiser] makes a lot of sense," Angoff said. "I see no benefit for North Dakota to necessarily go to a state exchange once the federal exchange is up and running."

Keiser noted, for example, that, by law, each state has to establish its own essential benefits criteria.

He said North Dakota had opted for a basic benefit package that included the least possible number of benefits. But, Keiser said, the North Dakota plan is designed so that insurers can market their product to add additional benefits.

"Insurance companies are very good at packaging their products and marketing them to add additional benefits," Keiser said.

Keiser's justification of PPACA was interesting because he comes from such a conservative state.

He said that from his perspective, the healthcare law was an attempt to use a patchwork approach, to save the current healthcare system. "What systems did we have for funding health care?" Keiser asked.

"I really compliment HHS," Keiser said. They looked at this from 30,000 feet and said, where are the doughnut holes?"

"We have small groups, individual market, small group markets, Medicare, Medicaid, the State Children's Health Insurance Plans, workers compensation and auto insurance," he said.

He asked, "What didn't we fund? We need to cover the 26-year-olds. These kids are going to college a little longer, they are very healthy, but we need to bring them in under their parents.

"What did the Medicaid expansion do? It filled another doughnut hole. What did the penalties, the incentives on providing insurance with subsidies do? It filled doughnut holes," Keiser said.

In general, Keiser said, the bill was an attempt to look at the doughnut holes systemically, and tried to plug them.

"Will it work," he asked. "Well, the average family pays over $1,000 a year due to cost-shift from those who don't have insurance and go to emergency rooms," Keiser said.

Keiser also said at the hospital in North Dakota on which he serves as a board member, 6 percent of those visiting the emergency rooms as their medical plan have dental problems only. "There is not a thing you can do except provide them with medication," he said.