Gov. John Hickenlooper and state legislative leaders have just named a new board to help implement the federal Affordable Care Act in Colorado. He tells us why he's backing the law at a time when some governors are actively resisting it in their states.

[Photo: Governor's office]

Learn more about how Colorado's government is responding to the Affordable Care Act here.

 

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RYAN WARNER, Host:

This is Colorado Matters from Colorado Public Radio. I'm Ryan Warner.

Gov. John Hickenlooper has just taken a big step toward implementing the new federal health care law in this state. On Wednesday, he, along with legislative leaders, chose the men and women responsible for crafting the state's health insurance exchange.

This is supposed to bring down the cost of insurance for people and small businesses by creating more competition. So, instead of having two or three policies to choose from through work, buyers will be able to shop from more offerings on an exchange website.

The appointees include an advocate for the poor, an ER doc, the head of a payroll firm. There are also several insurance company executives from Anthem Blue Cross, Rocky Mountain Health Plans and United Healthcare. About those executives, Hickenlooper says:

JOHN HICKENLOOPER, Colorado Governor:

They're not going to have a loud voice in this and I would all but guarantee that they're going to be individuals who represent what would generally be referred to as progressive aspects of the whole healthcare delivery conundrum.

Warner: We talk to the governor regularly and this time around health coverage is our focus.

Governor, thanks for being with us again.

Hickenlooper: Glad to be back.

Warner: I'd love to talk to you about how you came to your current perspective on healthcare. Before you got into politics, you were an entrepreneur and a restaurant owner. Could you afford to offer your employees healthcare?

Hickenlooper: We offered healthcare to the managers and we decided, way back in the beginning, that we would try to-- if the employees would pay half, then we would pay half. So we used-- I think we started with Kaiser Permanente.

Warner: And was it a challenge to afford that?

Hickenlooper: Always. And it became worse and worse and worse. The costs went up so dramatically compared to everything else.

Warner: So as you have looked at the provisions of the Affordable Care Act, I wonder if you've thought, gosh, that would have been helpful when I was running those restaurants. That would have made a difference.

Hickenlooper: Well, certainly the healthcare exchanges that Colorado passed legislation last session to enable would have made a big difference because they allow small businesses to bundle together and get access to group rates, you know, the same rates that larger corporations get. And that would have made a big difference.

Warner: And do you think it would have made a difference fast enough? Because you were facing annual increases that could have broken the bank.

Hickenlooper: Nothing's fast enough in healthcare. If you step back and look at how rapidly the rates have been growing, we're out of time. Pretty much everybody agrees to the basic principles, right? People with preexisting medical conditions, they ought to be able to get insurance. But if you don't have a system where everybody pays in somewhat, it would never work.

So somehow, we have to have a system whereby everybody's got a little skin in the game. I think we're going to probably have to end up with something where everybody, even people living, you know, making $8 or $10 an hour, everyone's going to have to pay something for their healthcare.

Warner: What you're getting at here is the individual mandate, the idea that everybody is going to be required to have health insurance or face some sort of a penalty if they don't. The attorney general of this state, John Suthers, has joined other states in suing to stop the individual mandate from moving forward.

What's the effect of that on how you progress, as governor, on implementing federal healthcare reform in this state?

Hickenlooper: I think we still, as a state, even if the federal requirements and the federal statute went away completely, need to continue exploring how do we get coverage for people with preexisting medical conditions. How do we make sure that they can get-- have access to insurance that they can afford? How do we begin reining in costs around our medical care so that small businesses, like my old business, aren't constantly being faced with rising and rising costs?

Warner: So most parts of Colorado already suffer from a shortage of doctors and other healthcare professionals. If the individual mandate survives, that is, everyone has to have insurance, won't that make the shortage of professionals in healthcare worse? Maybe everyone has a health insurance card but doesn't have anyone to turn to for care.

Hickenlooper: I am not convinced that it's going to be, you know, something we can't solve. And perhaps we're going to have to focus our educational systems a little more aggressively on generalists who can function more successfully in rural environments and perhaps we'll offer some sort of tuition remission or ability to forgive student loans for medical students if they make a certain commitment for rural areas, that kind of thing. We've certainly looked at that in the past.

Warner: Do you think there might be more state support for the medical school, which right now is largely funded by money it raises on its own?

Hickenlooper: Did you-- have you found new revenues for me? You know, a week does not go by where there's not some place where there is an organization, an agency, a university that is doing great work that needs more resources. But right now, there is no capacity, right? We don't have money from-- some hidden pool of money that we can suddenly say, that's how we'll get those rural doctors. We're going to help fund them through the med school over at CU. We just don't have those resources.

Warner: Is it fair to say that you stand fully behind the Affordable Care Act or are there parts you'd like to see change?

Hickenlooper: You know, there are 2,400 pages in the Affordable Care Act. You can't convince me that there wasn't a simpler way to get pretty much to the same place. Even though I don't support it 100% and I'm not going to say that I think it's, you know, the world's greatest piece of legislation ever written, my goodness, we needed to do something. I mean, this had been dragging on for decade after decade.

I mean, I think the exchange really is going to allow us to have more control, more quality choices, better protections when buying insurance. It allows small businesses and individuals, you know, much greater control in terms of making their decisions. And by getting these pools together, it will give them, I think, much lower cost opportunities.

You know, Colorado -- one of the interesting things about this, we are-- of the 10 states that have passed legislation around exchanges of one sort or another, we were the only state to do it in a fully bipartisan way and I think that's going to be a big part of the success is this isn't about Republicans and Democrats. I don't think it's about kowtow to the federal government. I think it's about trying to solve our problem. And no matter what happens in the courts, these exchanges have the potential for huge value for our community.

Warner: This will rely on computerization. It will rely on the web so that people can access all these choices in an exchange and I can't help but think of all of the problems that the state has had with a system called CBMS, the benefits management system. This was, years ago, envisioned as a way to streamline the process of getting state and federal benefits to Coloradans. It has been plagued, suffice it to say, with problems.

How are we to trust the state to build something that's bigger and more complicated?

Hickenlooper: A) I'm not sure it's going to be bigger and more-- I mean, CBMS was a big, gnarly, complicated creature. For the record, built long before I ever dreamed of running for state government. So it's been around for a long time and I think some of the approaches that we're using around the healthcare exchanges are very different than the approaches they used with CBMS.

We're looking to find ways to partner with a number of other states so that we can collaboratively create a software system that would spread the cost between a number of different states, but we also get different perspectives in terms of what we're designing and, hopefully, you get enough smart people around the table, you'll design a system that works.

Now, as a citizen who read the papers just like you did and heard the broadcasts and saw CBMS and just how challenging that was, you can bet I'm nervous. But just because you didn't do something right the first time, you didn't get it right the first time you tried it, doesn't mean you quit. It doesn't mean all technology is bad. It means you need to get, you know, a better perspective. You need smarter people. You need more smarter people.

The new Chief Information Officer and Secretary of Technology that we've got, Kristin Russell, was, you know, Senior VP of Global IT Services at Oracle. That's the second-largest software company in the world. Kristin is very gifted in these kinds of things and has seen the conflicts that arise when you're designing large, complex systems. And I think she's going to be an incredible asset as we move into our healthcare exchanges.

Warner: You know, not every governor is backing the White House in its efforts to implement the Affordable Care Act. Florida Gov. Rick Scott has refused to take or spend any federal money for that purpose. New Mexico's Susana Martinez opposes it. Have you had any conversations with those governors?

Hickenlooper: Yeah, I've talked to several of the governors and they are, in my opinion -- and I'm not second guessing their decisions or I don't want to second guess their decisions -- but they are clearly taking a political perspective.

If you ask me, my opinion, Colorado is-- we get back way too few of the tax dollars we send to Washington. And so to suddenly say, we're not going to-- they're offering a $2 million or $3 million set of grants to implement an exchange that whether the legislation gets turned over in court or not, we can use to help lower costs for individuals and small businesses in Colorado, I think we'd be chumps not to do it.

Warner: You talk about money that the state gets back from the federal government. Healthcare reform, of course, includes a major expansion of Medicaid. Across the country now governors are complaining that Medicaid costs are breaking state budgets. What does the Medicaid expansion mean for Colorado taxpayers?

Hickenlooper: Well, I think we have to find a way as we expand Medicaid coverage to do so in a way that we don't increase expenses. Because clearly the federal government is not going to come bail us out. There's finally -- and I think it's overdue -- a sense of fiscal conservatism sweeping both houses of Congress. They're not going to start writing big checks.

And in Colorado, if you look in every direction, we are dramatically underfunded. In transportation, if you believe the engineers and the studies that they've created in the Department of Transportation. Higher education has gone from 22% of our general fund state budget down to 9%. And so they-- each year they're raising tuition 9%, 12%, 15% just to keep pace. K-12 education over the last couple of years we've cut almost $500 million a year.

I mean, there's no excess money in our system. So we really, if we're going to expand Medicaid, there's no other choice, I think, but to find A) cost controls and B) some system that works where everybody pays.

Warner: What do you say to people who just plain don't think the White House's health reform plan is going to work?

Hickenlooper: Well, so often people are dug in on this issue that I don't get into the argument. The few times I did, it didn't seem very constructive. What I ask them is, do you feel that people deserve, if they've got a preexisting medical condition, do you think they deserve to be able to get healthcare insurance? Almost everyone I talk to and by that, I mean 99 out of 100 people, say, yes. Even if they've got a preexisting medical condition, they should be able to get health insurance.

So then I say, so how do you think we get there? And they-- you know, they wrinkle their brow and they kind of look at the ceiling and they go, geeze, I'm not sure. I guess we've got to work on that.

Well, that's what we're doing. We're going to work on it and work on it hard.

Warner: Governor, thanks so much for being with us.

Hickenlooper: Oh, you bet. It's always a pleasure.

Warner: Democrat John Hickenlooper is Governor of Colorado. We speak with him regularly from the Capitol.