States Could Lose Billions by Opting Out of Obamacare

UPDATE: If Florida Gov. Rick Scott really decides to not expand Meidcaid as outlined by the healthcare reform law it would mean that Florida would lose billions in federal funding, according to the Miami Herald, which cites two studies on the issue. Florida would hardly be alone. Any governor planning on taking advantage of the flexibility granted by the Supreme Court on certain parts of the Affordable Care Act would be waving goodbye to lots of federal funds and have lots more uninsured people on their hands.

Given the economic reality, experts are quick to say it’s virtually unthinkable any governor would actually opt out of the Medicaid expansion, noting the federal government would foot most of the bill, reports CBS News. Yet it seems even more unthinkable in the case of Florida, where Medicaid expansion would cover almost one million people in a state with the second-highest rate of uninsured.  

July 2, at 10:58 a.m.: Florida Gov. Rick Scott said Sunday evening he will not implement changes under the Affordable Care Act. Essentially, Scott made it clear his state won't comply with the Medicaid expansion or health care exchange provisions as required in the law upheld by the Supreme Court last week. 

On Fox News, Scott echoed the sentiments of some other GOP governors, who have declined to start work on the law's provisions until after the November elections, noting Mitt Romney has pledged to repeal the law if he becomes president. But Scott took his opposition one step further, vowing not to "implement these exchanges that will increase the cost of health and make Medicaid worse," even if Obama is re-elected. Louisiana Gov. Bobby Jindal and Wisconsin Gov. Scott Walker have made similar remarks. And while Texas Gov. Rick Perry has also made some strong statements against the law, he hasn't officially announced whether his state will or will not comply with the law. As the Slatest noted last week, other Republican governors are waiting until after the elections to decide.

In an official statement released Sunday, Scott explained his decision (via the Tampa Bay Times):

I believe we need more choice for patients, more free-market competition, increased accountability for providers, and incentives for personal responsibility. These are the things we can do that will hold down health care costs and make it affordable for more people. Unfortunately, ObamaCare doesn’t do any of those things. In Florida, we are focused on becoming the number one place for businesses so that Floridians have more jobs.

Under the law, states are required to set up health insurance exchanges for those without coverage to compare plans and purchase insurance by Jan. 1, 2014. States that don't meet deadlines risk having the federal government come in and do it for them. They will also have to decide whether to expand Medicaid, as Slate's Matt Yglesias explains.