A bipartisan solution for the Affordable Care Act

Last month, majorities in Congress voted to repeal the Affordable Care Act. Not surprisingly, President Obama vetoed the repeal bill, and the Republican Congress was unable to override the president’s veto.

As former leaders in Congress, we have a message for both sides in this debate: It’s time to give the states a chance.

This doesn’t mean that conservatives and Republicans have to give up the fight to reduce the regulations and taxes in the law. It also doesn’t mean that progressives and Democrats have to stop defending protections for the underinsured and uninsured.

Instead, it’s time to look to a provision of the Affordable Care Act - Section 1332 - that can achieve what both sides earnestly wish for: providing more Americans with access to more affordable, flexible, patient-centered health care.

Since we share these goals, we prepared a report with the Bipartisan Policy Center by working out our differences and seeking common ground. The process was at times grueling, but that made it all the more rewarding to be able to develop collaborative, bipartisan recommendations. We wanted to offer a way past the impasse over the Affordable Care Act without either of us having to sacrifice our core principles.

Section 1332 of the Affordable Care Act creates a process for generating State Innovation Waivers - the result of a bipartisan agreement between Sen. Ron Wyden, D-Oregon, and then-Sen. Bob Bennett, R-Utah. As a result, both sides have the ability to explore ways to serve taxpayers and patients better by rewarding innovative, localized and effective systems of care delivery while maintaining critical protections.

Beginning in 2017, the provision allows states to opt out of the Affordable Care Act requirements, so long as certain conditions – or “guardrails” – are adhered to. These guardrails require states to offer coverage that is at least as comprehensive as the ACA’s essential health-benefits package; that is at least as affordable; that insures at least a comparable number of residents; and that maintains federal deficit neutrality.

So long as those conditions are satisfied, the waiver provision is intended to give states a great deal of flexibility. Namely, states can waive certain provisions of the law, including those relating to the individual and employer mandates, provided they demonstrate that a comparable number of residents would receive coverage. However, some provisions, such as requiring the coverage of those with preexisting conditions, cannot be waived.

Unfortunately, the administration didn’t promulgate its interpretation of Section 1332 until December. Consequently, in the absence of earlier guidance, states have been slow to act on this opportunity to experiment, innovate and transform their healthcare systems within this framework. And the recent federal guidance may further delay the use of this provision should states perceive it as not providing sufficient flexibility.

To correct this, we encourage the Obama administration to convene the nation’s governors to advise it on future Section 1332 rule- making. Collaboration between the states and the Department of Health and Human Services would ensure the implementation of a regulatory framework that can help states realize their full potential as laboratories of innovation.

While we support the administration’s decision to interpret the requirement to permit deficit neutrality over the length of the waiver, we would encourage it to go a step further. The administration should allow states to combine related funding streams (such as from Medicaid and tax credits) into any comprehensive waiver program put forth. Together, these recommendations would maximize state flexibility and ensure that upfront costs were invested wisely by the states.

This, and other efforts to improve our health-care system, will require bipartisan consensus and action from Congress and the administration. Despite the talk of dysfunction in Washington and the heated rhetoric of another campaign cycle, we believe it’s essential that this opportunity not be missed.

Our proposal represents a step toward bipartisan health-care reform. More important, it offers a glimmer of hope that pressing concerns can be addressed thoughtfully and substantively by this and the next generation of leaders in Washington.