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Obama To Governors: Opt Out of Health Law If You Can Do Better

U.S. President Barack Obama hosts a meeting with a bipartisan group of governors in the White House Monday. (Getty Images)

President Obama is moving to quell a rebellion among the ranks of the nation's governors, who want more of a say in how billions of dollars in shared health care dollars are spent.

At a working session Sunday, several governors called for turning the joint federal-state Medicaid program into a system of "block grants," where they would be able take federal dollars and spend them as they see fit.

That's something long pushed by Republicans, and long opposed by Democrats.

Instead, however, at the governor's annual visit to the White House Monday, President Obama offered a much smaller concession to health spending flexibility: Endorsement of a bipartisan proposal to allow states to opt out of most of last year's health law's requirements sooner than was originally envisioned when the law was passed.

"Beginning in 2017, if you can come up with a better system for your state to provide coverage of the same quality and affordability as the Affordable Care Act, you can take that route instead," Obama told the governors.

And Obama said he supported moving that date up to 2014, as proposed by Sens. Ron Wyden, D-Ore., and Scott Brown, R-Mass., to "give [governors] flexibility more quickly, while still guaranteeing the American people reform."

A lot of people have called this the "calling their bluff" proposal. And Sen. Wyden, who's been shopping the bill around to both Democratic and Republican governors, doesn't completely disagree.

"You've got a lot of states where Republican governors, Republican legislatures, are clearly going to have their ideas about health reform," Wyden said in an interview. "As long as they meet the coverage requirements in the bill, they can do it. And progressive folks are gonna try the same kinds of approaches."

In fact, noted Wyden, Vermont Gov. Peter Shumlin is pushing for the idea of having a "single payer" system rather than requiring everyone to have private health insurance.

Republicans governors, however, aren't yet embracing Wyden's proposal, or President Obama's promise of more flexibility in health care spending.

"He says very nice things and he says them very nicely," said Gov. Chris Christie, R-N.J. "But in the end I have a job to do, and what I'd like is to have the flexibility to exercise the authority that the people of New Jersey gave me in November of 2009."

Meanwhile, Kansas Republican Gov. Sam Brownback, echoing the concerns of many governors, says what he really wants isn't more flexibility when it comes to the health care law, but for Medicaid.

"Medicaid is creating a huge hole in my budget and we had to take money from all other places in state government to fill the Medicaid hole," Brownback said.

On Tuesday several governors will testify before the House Energy and Commerce Committee on the impact of the new health law on Medicaid and state budgets. It's a hearing that's expected pour more fuel on the fire of the ongoing health wars.

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Transcript

MICHELE NORRIS, host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Michele Norris.

MELISSA BLOCK, host:

And I'm Melissa Block.

A lot of state executives are upset about the rising cost of health care and the effect it's having on their shrinking budgets, and they're demanding more flexibility from the federal government.

So President Obama is offering them something. NPR's Julie Rovner reports it's not really what the governors want.

JULIE ROVNER: Speaking to a group of governors at the White House, the president reminded them that last year's health law actually does give them a chance to take all that federal money the law provides and do just about whatever they want with it, just not right away.

President BARACK OBAMA: This portion of the law has not been remarked on much. It says by 2017, you have a better way of doing it, help yourself, go ahead. Take that route.

ROVNER: Now a bipartisan group of senators, led by Oregon Democrat Ron Wyden and Massachusetts Republican Scott Brown, have proposed to move that date up by three years, to 2014. And today, President Obama threw his considerable endorsement behind that effort.

Pres. OBAMA: It will give you flexibility more quickly while still guaranteeing the American people reform. If your state can create a plan that covers as many people as affordably and comprehensively as the Affordable Care Act does, without increasing the deficit, you can implement that plan.

ROVNER: A lot of people have called this the calling their bluff proposal. And Senator Wyden, who's been shopping the proposal around to both Democratic and Republican governors the past few months, doesn't disagree with that description.

Senator RON WYDEN (Democrat, Oregon): You've got a lot of states, you know, where Republican governors, Republican legislatures, are clearly going to have their ideas about health reform. They can go out to the state legislatures and come up with approaches that they think will be real reform, and as long as they meet the coverage requirements in the bill, they can do it. And progressive folks are going to try the same kinds of approaches.

ROVNER: Republicans governors, however, aren't yet embracing Wyden's proposal or President Obama's promise of more flexibility in health care spending. Here's New Jersey's Chris Christie on the president after the White House meeting.

Governor CHRIS CHRISTIE (Republican, New Jersey): He says very nice things, and he says them really nicely, and they're pleasant to listen to. But in the end, I have a job to do. And what I'd like is to have the flexibility to exercise the authority that the people of New Jersey gave to me in November of 2009. And I don't think that's unreasonable to ask.

ROVNER: Kansas Republican Governor Sam Brownback, meanwhile, echoing the concerns of many governors, says what he really wants isn't more flexibility when it comes to the health care law but for the Medicaid program for the poor.

Governor SAM BROWNBACK (Republican, Kansas): And Medicaid's eating me up alive in Kansas. Medicaid is creating a huge hole in my budget, and we had to take money from all other places in state government to fill the Medicaid hole.

ROVNER: Tomorrow several governors will testify before a Republican House committee on how Medicaid is hurting their budgets. That's expected to pour more fuel on the fire of the ongoing health wars.

Julie Rovner, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

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