President Obama has thrown his support behind a bill to let states opt out of key features of the healthcare reform law before they take effect, including the controversial requirement that virtually all adult Americans buy insurance. The caveat, though, is that states must offer alternatives that provide comparable coverage to at least as many of the uninsured as the new law would, at no greater cost to federal taxpayers. It's a small but welcome move that invites opponents of the law to shift from repealing it to improving it. Unfortunately, they probably won't accept that invitation.
The healthcare law already includes a provision by Sen. Ron Wyden (D-Ore.) to let states seek waivers from four requirements: state insurance exchanges to help people buy individual policies; minimum standards for what those policies must cover; insurance subsidies for lower-income Americans; and mandates on individuals and large businesses to carry coverage. To obtain a waiver, a state would have to commit to an alternative reform that would be just as effective at increasing coverage and improving affordability without increasing the federal deficit. Under current law, those waivers would not be available until 2017, three years after the requirements took effect.
The bill that Obama endorsed this week would make those waivers available in 2014, the same time the law's most controversial provisions kick in. The change makes sense. States that want to pursue their own reforms shouldn't have to toe the federal government's line for three years as a prerequisite.