In Washington, the two major forces within the GOP are the Tea Party and K Street. Think Jim DeMint vs. Trent Lott; or Club for Growth vs. Chamber of Commerce; or FreedomWorks vs. Karl Rove.

A similar divide exists in state capitals, and the current battleground are federally subsidized Obamacare exchanges in health insurance and Medicaid expansion. For one example, see Ohio, where conservative Gov. John Kasich has taken a big step towards implementing ObamaCare’s Medicaid expansions.

Some highlights from the Politico report:

“Medicaid is a broken, costly system that needs meaningful reform; expanding the system to include another 365,000 individuals is exactly the wrong policy for Ohio families,” said Nicole Kaeding, state policy manager for Americans for Prosperity. “Instead of trapping families in a system that doesn’t work, Gov. Kasich should devote his efforts and activities to forcing Columbus and Washington to pass badly needed reforms.”

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And local health care and business leaders have been pushing Kasich to do it. They say Ohio will save money in the long run and that it makes business sense to do it so community hospitals aren’t forced to close….

Jonathan Archey, a top lobbyist at the Ohio Hospital Association, calls Kasich “a political pragmatist” who recognizes that Medicaid block grants aren’t about to happen under Obama and the current Congress — so he’s using the offer of extra federal dollars as “an opportunity for Ohio to explore different ways of providing Medicaid services.”…

Local health officials have been working hard on Kasich to say yes to Medicaid expansion. They promised that if he did, they’d work hard to convince state Republican lawmakers that the move would help Ohio rather than hurting it.

“We’re telling him we have his back on this,” said Oliver Henkel, chief external affairs officer at the Cleveland Clinic.