The future of state health care innovation depends on Gov. Kemp protecting Georgia’s waivers

Upon taking the oath of office in 2019, Georgia Gov. Brian Kemp quickly became a national leader in health care reform after he introduced two innovative, first of their kind proposals to partner with the federal government to expand access to affordable, quality health coverage for uninsured Georgians.

By fall 2020, Kemp gained federal approval from the Trump administration for both plans and began to implement them. But now, in an unprecedented political move, the Biden administration is trying to renege on the partnership.

The future of state and federal partnerships may hinge on Kemp’s actions to enforce the agreement. States have long played key roles in developing and testing policies to improve the health care system. But, if the federal government can just pull the rug out from under a state’s health reform efforts at any time, why would a state—whether red or blue—go through all the work and expense to develop a proposal and gain approval?

Congress allows the federal government to waive certain federal requirements because it recognizes that states are important “laboratories of democracy.” Federal waivers include Medicaid demonstration waivers and state innovation waivers under the Affordable Care Act (ACA). Approval of these waivers creates a partnership between the state and federal government and is governed contractually by a set of agreed upon terms and conditions.

Kemp’s innovative programs take advantage of both waivers. The “Georgia Pathways to Coverage” Medicaid demonstration waiver creates a new Medicaid program that extends access to affordable health coverage to support Georgians in their journey to self-sufficiency and financial independence.

Georgia’s second waiver, the “Georgia Access Model,” uses an ACA state innovation waiver to help more people access private health insurance through two strategies. First, it implements a reinsurance program which lowers premiums by paying a portion of high-cost claims. Second, instead of enrolling people through—the federal insurance exchange—the waiver takes advantage of private sector resources and incentives to allow individuals to better shop and compare health insurance plans. The move away from was a response to declining enrollment and the exchange’s failure to reach a large portion of the uninsured—half of whom were estimated to qualify for ACA premium subsidies.

Together, these programs will connect thousands of uninsured Georgians to affordable health coverage. Nonetheless, the Biden administration rescinded Georgia Pathways and suspended Georgia Access. Biden has also attempted to rescind nearly every other Medicaid waiver approved during the Trump administration. No other administration has attempted such sweeping and blatantly partisan rescissions.

If this wrongheaded precedent is allowed to stand, it likely means the end of state innovation and flexibility through federal waivers, regardless of politics. Biden is inviting the next Republican administration to rescind every state partnership his administration establishes.

These efforts will have a chilling effect on state innovation, as governors might be reluctant to invest state resources and political capital to partner with the federal government, knowing a new administration will likely nullify it?

Fortunately, Kemp is fighting back.

Suing to enforce the agreements in federal court is the right response. These partnerships are governed by federal statute and the law of contracts, and depend on good faith implementation from the executive branch to faithfully execute the partnerships as Congress designed.

Kemp already sued Chiquita Brooks-LaSure, Biden’s Administrator at the Centers for Medicare & Medicaid Services, to block the rescission of the Georgia Pathways Medicaid waiver and won. A federal judge issued a strong rebuke to the Biden administration, concluding the rescission was “arbitrary and capricious on numerous, independent grounds.”

Similarly, Kemp should sue to block the suspension of Georgia Access. The Biden administration wrongly reopened the approved waiver application, demanding that the state produce more data to support coverage estimates that were already provided in the approved application. The previously agreed upon contract between the federal government and Georgia does not allow this. Kemp appropriately rejected this impermissible demand. The administration responded by suspending the waiver, requiring the state to submit a “corrective action plan” for something that didn’t need correcting. Because the administration’s suspension is based on impermissible demands, it constitutes a breach of the waiver and grounds to sue.

Success in federal court to enforce both waivers would set an important precedent to ensure the federal government honors its agreements and remove partisanship from the waiver process. The future of successful state-federal partnerships on important health care initiatives could hang in the balance.

Seema Verma is the former Administrator at the Centers for Medicare & Medicaid Services. Randy Pate is a former Deputy Administrator at the Centers for Medicare & Medicaid Services and Director of the Center for Consumer Information and Insurance Oversight at the Centers for Medicare & Medicaid Services. Peter Nelson is a former Senior Advisor to the Administrator at the Centers for Medicare & Medicaid Services. 

This article originally appeared at the Insider Advantage