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Washington won’t decide Obamacare’s future this year. Topeka will.

Obamacare isn’t shrinking. It’s actually expanding.

Photo by Mark Reinstein/Getty Images

If you want to keep up with the future of Obamacare, you'd be better served following the news from Topeka, Kansas, than the news out of Washington.

This is not a joke! My favorite news publications right now are the Kansas City Star and the Lawrence Journal-World. Both are covering the twists and turns of the state's Medicaid expansion battle. That, and not the Washington debate over Obamacare repeal, is the key health policy fight to watch right now.

Republican efforts on Obamacare repeal are stalled. There is no plan that can get enough support to move through Congress. Chris Jacobs, writing at the Federalist, has an especially good synopsis of why this problem seems intractable. He writes that there are "fundamental disagreements within the Republican party and the conservative movement about Obamacare." Namely:

On the one hand, the conservative wing of the party has focused on repealing Obamacare and lowering health costs — namely, the premiums that have risen substantially under the law. By contrast, moderates and centrists remain focused on its replacement and ensuring that those who benefited from the law continue to have coverage under the new regime.

In the AHCA, Republicans tried to split the difference — and pleased no one. There is a lot of talk about "wanting" to move forward on repeal and replace. There is not a path to get there.

Meanwhile, the Medicaid efforts are more active than ever before. Nineteen states still aren't participating in Obamacare's Medicaid expansion. Now that Obamacare appears to be here to stay, efforts are underway in several states — either in the legislature, among governors, or spearheaded by community groups — to join in and bring coverage to their low-income residents.

Virginia Gov. Terry McAuliffe explained the thinking behind efforts like this: "Year after year, they [Virginia Republicans] have put out false excuses for not expanding. The latest one that I always heard was that the law would be repealed. Now we have heard from the president of the United States himself that it’s not going to be repealed."

Medicaid is a hugely important way Obamacare expands insurance. The expansion of that public program is responsible for most of the coverage gains under the Affordable Care Act.

In 2015, CBO estimated that an average of 14 million people annually would gain coverage through that provision over the next decade. But in early 2016, the agency revised its numbers significantly upward, estimating that 18 million would enroll in coverage each year.

There is actual, real policymaking happening in the states! Kansas Gov. Sam Brownback now has a Medicaid expansion bill, approved Tuesday by the state legislature, sitting on his desk. He has 10 days to decide whether to veto or sign it — and the expectation is he will veto. The big question is whether a few more Kansas legislators will sign onto the expansion bill, giving it a veto-proof majority.

The Kansas City Star published an editorial this morning titled, "Please, Governor Brownback — sign the Medicaid expansion bill."

Meanwhile, Maine is preparing for a ballot initiative in November on Medicaid expansion. It looks like Georgia Gov. Nathan Deal, a Republican, is signaling an openness to expansion, although his statements admittedly aren't very clear. A spokesperson told Vox, "the governor is exploring a variety of solutions that bring Georgians greater flexibility and access to care. No specific proposals have been decided upon, but he will continue working with members of the General Assembly to evaluate all options.”

Vox's Dylan Matthews and Jacob Gardenswartz, doing hero's work, reached out to elected officials in 18 states that have not expanded Medicaid to get a sense of where the debate currently stands. I strongly suggest reading it! Despite all the fuss over Congress, I'm pretty convinced the most important health policy stories will happen in the states in 2018 — both in the Obamacare marketplaces the states run and how they manage this very big Medicaid decision.

Chart of the Day

Commonwealth Fund

Obamacare's cost-sharing subsidies significantly reduce how much poor Americans pay for coverage. They're also at risk. Low-income Obamacare enrollees get subsidies to reduce their deductibles and co-payments, as you can see in the chart above from the Commonwealth Fund. Someone who earns $17,000 gets financial help from the government to bring her deductible down from $3,500 to $125.

But that might all be about to change. As Nick Bagley writes, there is an important lawsuit pending over these subsidies. And it's up to the Trump administration whether or not to defend them. Read Nick's in-depth explainer on this lawsuit, which he argues could "blow up" the Obamacare marketplaces.

Kliff's Notes

With research help from Caitlin Davis.

  • "Price defends NIH cuts, leaves door open to Obamacare changes": "Health and Human Services secretary Tom Price told a House subcommittee this morning that he's OK with President Trump's proposed cuts to the National Institutes of Health, because they might help the federal government get 'a bigger bang for our buck.' And he promised to 'uphold the law' on Obamacare, but insisted that 'the current law has harmed many individuals' and said he'll look for ways to let insurers provide cheaper coverage." — David Nather, Axios
  • "LePage considers starting Maine health insurance plan to replace Affordable Care Act": "'We are just going to withdraw the state and just go do our own thing,' LePage said. 'The federal government obviously is broken so they are not going to stand in the way. They can’t get anything done.' The governor did not provide details on how he would create a state health insurance system, but suggested it could be modeled on the state’s workers’ compensation insurance system or a law he and the Republican-controlled Legislature had enacted before the ACA launched in 2013." — Scott Thistle, the Portland Press-Herald
  • "How Republicans’ obsession with tax cuts for the rich drove their health care plan over a cliff": "The AHCA suggests that Republican elites remain unified (if not completely) around one goal: tax cuts for the rich. The problem for them is that this goal is shared by few outside their donor class. It is also at odds with another of their core priorities: cutting back the American welfare state. Republicans hoped to replay the productive initial pushes of the past two presidents to preside over unified government: President George W. Bush oversaw significant tax cuts, and President Barack Obama signed the Affordable Care Act." — Jacob Hacker and Paul Pierson, Vox

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