Similarly, ObamaCare supporters have tried to stoke conservative anxieties about federal power by pointing out that if states refuse to run the exchanges, the federal government will do it for them, thus increasing federal power at the expense of the state. States have responded—correctly—that they don’t actually get that much flexibility or authority under the law, except to follow federal rules, but forget that for a moment: From the perspective of an ObamaCare supporter, would increasing federal power over the law really be so bad? I’d imagine that few of the law’s backers have serious problems with increasing the scope of federal authority over the law, especially when the alternative is to see parts of it set up and run by conservative state officials. Meanwhile, states that opt out now have the option to take over the exchanges down the road: If it’s obviously better to be running—and paying—for these insurance hubs, then states that don’t go for the expansion up front can step in later. (Interestingly, Jonathan Gruber, one of the architects of both RomneyCare and ObamaCare, and a leading proponent of both laws, recently suggested that Florida should let the federal government run its exchange, at least for the time being.)
I’m no fan of ObamaCare, but we’re actually primed for a potentially interesting experiment in health care federalism: Some states will go ahead with full implementation. Others will decline to participate in either the exchanges, the Medicaid expansion, or both. And as a result, we’ll be able to see if it works, and how well. If it’s worth doing, states that don’t play along now will have clear incentives to do so down the road.