The ins and outs of health insurance exchanges

“Say No to Obamacare” reads one message in response to the Senate Commerce and Human Resources Committee voting this past week to give a full hearing to legislation that would create a state-run health insurance exchange for Idaho. SB 1042 is the first step for the Idaho Legislature to consider approving what Governor Otter has made clear: that he wants a state-run exchange over one controlled by the federal government. In the form of an online marketplace, this exchange is meant to help the uninsured find insurance. As I am getting many messages from home on this issue — saying both yes and no — there are some questions I personally had and some answers I found that I thought I would share.

• Why set up an exchange?

On March 23, 2010, the President presented and the U.S. Congress passed the Patient Protection Affordable Care Act. This massive bill’s main mandate was that everyone have health insurance. And one way Congress did this was to give funding to states’ to create their own health insurance exchange. If the state declined to set up an exchange then that state would be forced to participate in a federal exchange. Although many of us have opposed PPACA, Congress has tried to repeal it, and the constitutionality of it was brought to the Supreme Court, it has withstood to become law, and we must comply.

• What exactly is an exchange?

An exchange is an online marketplace that integrates with the current systems that determine eligibility for Medicare or Medicaid. If a person doesn’t qualify for Medicare or Medicaid, but still needs insurance, then they will enter a part of the system that shows them their private insurer options for side-by-side comparisons.

• What happens if we decide not to run our own exchange?

If Idaho’s legislature decides that Idaho should not run our own exchange, then beginning in January 2014, as written in the law, the federal government would step in and implement their version of an exchange. A federal exchange will not take in to consideration the unique situation of any state, including Idaho, instead, the federal government will regulate and oversee the exchange from Washington, D.C. In other words, saying ‘No’ means Idaho will get a federal exchange and this will cost Idahoans more money and may diminish our choices of insurance plans.

• Then what are the benefits to setting up our own exchange?

Idaho has been given federal funding to create an online marketplace that the Departments of Insurance and Health and Welfare will integrate with their current system that determines eligibility for Medicare or Medicaid. Important note: If a person already has purchased health insurance, has employer insurance or is already on Medicare or Medicaid then they are not required to participate in this exchange. I repeat — participation in the exchange is completely voluntary. That can be found in SB 1042 page 1, lines 28 through 30 and again on page 4, lines 14 through 21.

As a state we will be able to determine which insurers are allowed to be in the state exchange, giving us a lot of latitude in how we conduct the marketplace. SB 1042 dictates that the state exchange will be self funding (page 4 lines 11 through 13).

Ultimately, I believe, the citizens of Idaho will lose if we don’t create our own exchange because the Federal government will step in. The exchange they implement will not fit with the way we do things here, and we would not have control to change it.

I have stood beside the governor and many of my fellow legislators as we said “No to Obamacare” and fought against the federal health care law. We were the first in the nation to challenge it in court. We lost. Idaho has some of the lowest insurance rates in the country.

Turning our system over to a federal bureaucracy will cost Idaho citizens money and potentially leave them with less insurance coverage.

This is a controversial issue with good people at home and across the state on opposite sides. I believe that my oath of office to uphold our federal and state constitutions and our laws, means that I have to do just that, even when I don’t agree with the law. It is not a decision I make lightly, but to uphold my oath of office and to protect Idaho’s citizens, our low insurance rates and range of insurance options, and our pocketbooks, I believe we need to chart our own destiny with a state-based exchange.

The bill can be found on the internet at http://legislature.idaho.gov/legislation/2013/S1042.htm and more information can be found here: http://gov.idaho.gov/ under the heading “Hot Topics”. As always you can reach me via the toll free message center in Boise at 1-800-626-0471 or via email at skeough@senate.idaho.gov