State Power Over Health Care Reform

While the ACA is a piece of federal legislation whose implementation is being overseen by HHS, quite a bit of authority is up to the states:

The exchanges, which still have to be set up, are state based, as are Medicaid programs. State insurance commissioners will have a lot of power and control to set regulations on how the exchanges will work. That will make a big difference in how reform functions in the individual insurance market – where many of the uninsured are expected to get insurance.

While the overhaul sets national standards for minimum benefits that insurers must offer in the exchanges, states can augment them. States could demand that insurers meet certain criteria, such as benefits requirements, or decline to set any at all. Each state will also have to determine whether to administer the exchange itself, let a private entity do so, or decline entirely and submit to federal intervention. Additionally, the law provides states much leeway in determining what is an "unreasonable" premium increase. States could go as far as to refuse any increases without justification, or merely require justification only for severe increases, and then, perhaps, after the fact. The medical loss ratio can be changed on a state-by-state basis with approval from the Department of Health and Human Services.