January 19, 2018 (512) 246-9955
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States Quietly Start Prepping Exchanges

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By law, states are required to implement Democratic President Barack Obama’s health care overhaul.

Health officials in  24 Republican-controlled states are working behind the scenes to set up insurance exchanges that provide a market for individuals and small businesses to shop for affordable health coverage.  Nov. 16 is the deadline  for states to show they can do it, or the federal government steps in and does it for them.

Huge opposition is coming from republican governors and legislators who want states to do nothing until the national election on Nov. 6, hoping the party wins enough votes to repeal the law.

Conservatives  believe that if the federal government is forced to set up many of the exchanges, the system would likely fail which would make  the law easier to repeal if Republican nominee Mitt Romney defeats President Barack Obama in the election.

Insurance officials want a better contingency plan in case the Republicans lose, as the 10-day window between the election and the exchange deadline will not give them enough time to prepare an exchange.

The health care reform law passed in 2010 calls for health insurance exchanges to be in full operation by January 2014, helping to extend care to up to 16 million uninsured Americans.

United States Map State Health Exchange

13 mostly Democratic states have committed to establishing their own insurance exchanges, while a handful of others have said they would probably do it or agreed to form a partnership with the federal government. 7 states have outright refused.

In the remaining 24 states with Republican majorities in either legislative house, heated opposition means work on exchanges occurs haphazardly, behind the scenes and with fewer funds.

Half a dozen Republican state health officials interviewed by Reuters said they prefer to plan for exchanges now, rather than accept blame down the road for a federally run exchange that leaves voters worse off than their neighbors.

At least 15 others are also preparing for some kind of exchange, according to state planning documents, news articles and the Kaiser Family Foundation, which tracks states’ actions.

Even setting up health exchanges is not easy and many states need new laws to create and fund an exchange; they have to study local needs through dozens of meetings, hire staff and find contractors to set up the technology.

Many insurers, such as Aetna, Wellpoint Inc, or United Healthcare would also prefer the states to control local insurance markets rather than submit to federal regulation.

Republicans working on exchanges have been accused of party disloyalty, and that opposition has intensified after the Supreme Court upheld the Affordable Care Act in late June.

Romney is unlikely to repeal exchanges if he is elected, even if he gets rid of other parts of the health law, since the system would be too complicated to dismantle, or he may not have enough votes in Congress.

Romney suggested as much during a recent interview with NBC’s “Meet the Press,” saying he would keep some parts of Obamacare if he becomes president – though he did not mention exchanges specifically.

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Justin Lawhorn
Justin Lawhorn
I have been in the insurance business since 2001 and had the fortunate opportunity to start my own agency in 2002 as an independent agent offering group health insurance, individual health, life, and dental insurance.
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