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Idaho leaders stunned by ruling, face big decisions

BOISE - Idaho leaders were stunned by today’s ruling upholding the federal health care reform law, and face big questions on how to respond.

State lawmakers this year refused to set up a state insurance exchange under the law, betting instead that courts would overturn it. They turned away $20 million in federal grants for the exchange.

Idaho House Minority Leader John Rusche, D-Lewistion, a retired physician and health insurance executive, said the ruling “means we have a lot of work to do.”

State Insurance Director Bill Deal still is studying the decision and weighing how to proceed.

Deal said he was surprised the law’s individual mandate was upheld. “So now we know, and we can move forward, with hopefully some good direction in mind,” he said. As for a health insurance exchange in Idaho, Deal said, “It leaves us basically at square one.”

The rejected federal grant is “essentially off the table,” Deal said Thursday. “So there are other grants that are available, but we’re going to have to really sit down and determine if we go for grants, if the Department of Insurance and Health and Welfare will get spending authority to move forward with what now would be implementation.”

It’s also unclear whether the federal government will now impose a federally run exchange on Idaho, since Idaho hasn’t moved to set up a state-run exchange. “At this point I can’t tell you,” Deal said. He said his office is still working to “decipher” and “digest” the decision, and likely won’t know how it will proceed for several weeks.

Idaho officials also were taken by surprise by the court’s ruling that states can choose whether or not to comply with the law’s requirement to massively expand their Medicaid programs. The state currently limits Medicaid to certain low-income populations, mainly children, poor pregnant women and the disabled, but the federal law expands it to everyone under 65 who makes less than 133 percent of the poverty level. Idaho’s Department of Health and Welfare estimates the change would add 100,000 to 160,000 people to Idaho’s Medicaid program, which now has just over 223,000 enrolled, 70 percent of them children.

The high court ruled Thursday that states can’t lose their entire millions in federal Medicaid funding for the poor if they choose not to go along with the expansion - the hammer originally included in the law to get states to take part. But with the individual mandate in effect, everyone still would be required to have insurance or pay a penalty.

North Idaho Rep. Vito Barbieri, R-Dalton Gardens, who’s been among the Idaho Legislature’s most outspoken opponents of the health care reform law, said, “I know if the states do not comply, that they at least can’t strip the regular Medicaid help that the federal government is doing. But what does that mean for our constituents, and what is the added burden to the taxpayers in Idaho? How will the law affect their burden?”

For now, Idaho doesn’t have those answers.

“The state has no power to stop the federal government from taxing, so that kind of shoots any aggressive action to try and blunt the intrusion that I’ve been talking about over the last couple of years,” Barbieri said. He said he’s still analyzing the decision to see if there’s a way states can fight it, but he hasn’t found one yet.

Idaho’s all-Republican congressional delegation unanimously decried the ruling, and called for repealing the law.

“It is not the ruling that the American people wanted.” said Idaho Sen. Mike Crapo.

Idaho Gov. Butch Otter was out on a multi-day horseback trail ride Thursday and wasn’t available for comment; nearly seven hours after the ruling, his office issued a statement after talking with the governor by phone. “Obamacare has been bad for America from the beginning,” Otter said in the statement. “This is a sad day for self-determination and for individual liberty.”

Otter isn’t expected back in the office this week.

Rusche said the Legislature’s failure to act this year on an exchange “leaves us kind of behind.” He said, “I know the Republican mantra is ‘we’ll just go and repeal it,’ but the fact is that it’s the law of the land, and my guess is that there will be some action to try to comply.”

Idaho was one of 26 states suing to overturn the law, which Idaho lawmakers and Otter strongly opposed. But Idaho Attorney General Lawrence Wasden, who pressed the case, found something to celebrate in the ruling: The high court’s reasoning, he said, includes “a significant win for states’ rights.”

That’s because the court’s majority rejected the government’s argument that the individual mandate was justified under the Commerce Clause of the U.S. Constitution, while upholding it instead under the taxing powers of Congress.

“The whole argument that we raised was that the attempt by Congress here was an unconstitutional exercise of commerce clause power, and we were vindicated in that,” Wasden said. “It does matter. It’s not really so much the issue of today, but the issue of what the analysis under the Commerce Clause is that’s going to exist into the future, and what’s the relationship of the state government to the federal government into the future. These are very significant questions.”