Health Insurance Exchange Will Be A Major Debate in Upcoming Session

Prominent legislators agree the Idaho Legislature is hard to predict.  “You know, the interesting thing about the legislature is you never really know what the big issues are going to be until you get there,” said House Majority Leader Mike Moyle (R-Star), when asked what he thinks will be the defining debates in the 2012 session.  “You get down there and there’s something that pops up that’s a big issue and you never thought it would be.”  That said,  there is consensus that whether or not Idaho should create a state-run health insurance exchange will be one of the biggest questions before legislators in the months ahead.

Idaho Legislature / State of Idaho

House Majority Leader Mike Moyle, from Star, says Idaho should not create its own health insurance exchange unless it is given enough leeway to tailor the exchange to state needs.

Health insurance exchanges are a primary component of the Affordable Care Act.  By their most basic description, exchanges are new organizations — marketplaces — created to make available health insurance options more clear and more competitive.  In the health insurance market, individuals and small businesses don’t have perfect information or a great deal of bargaining power with insurers.  A health insurance exchange would lay out the private and public health insurance options, explaining plans in terms of benefit levels and costs.

Under the Affordable Care Act, states can create their own exchanges or wait for the federal government to do it for them.  Idaho Governor C.L. “Butch” Otter supports the creation of a state-run exchange, and Idaho has moved forward to receive a series of federal grants.  Many Idaho legislators, however, are not convinced the state should establish its own exchange.

Speaker of the House Lawerence Denney (R-Midvale) calls the number of legislators who oppose accepting federal money to create a state-run exchange “substantial.”  He calls his own feelings “mixed.”  “I certainly want Idaho to be in charge of running the insurance exchange,” he said, “but, on the other hand, I know that anytime the federal government gives us money, there are strings attached.”

Majority Leader Mike Moyle is more explicit about that reluctance to follow federal mandates.  “Therein lies the push-back from a lot of the legislators,” he said.  “Therein lies most of the debate: whether we can find a way to create an exchange that accomplishes what the state wants and the feds want, but doesn’t totally encompass everything that Obamacare wants.  And I just don’t think you can get there, currently, with the federal rules.”

Idaho Legislature / State of Idaho

Rep. John Rusche, a Democrat from Lewiston, serves on the House Health and Welfare Committee.

This month, the Obama Administration said it would not dictate to states a set of uniform “essential health benefits” that must be provided by insurers.  That move grants states greater control over the terms of state-run exchanges.  The new policy was released a day after StateImpact’s conversation with Rep. Moyle.

On the Democratic side of the aisle, House Minority Leader John Rusche (D-Lewiston) says the state could lose a great deal by not creating its own exchange.  “To assume that we’d be better off in a national exchange, I think, is foolhardy,” he said.  Rep. Rusche is a retired physician who serves on the Health and Welfare Committee.  He says the insurance companies that would serve the state under a federally-created exchange aren’t likely to spend a great deal of time looking out for the needs of people in rural Idaho.  “The Idaho marketplace would not be their primary focus,” he said, “so whether you’re talking about customer service or responsiveness to individual community needs, we would not be well-served.”

Moreover, Rusche says, Idaho’s two main insurers — Regence BlueShield of Idaho and Blue Cross of Idaho — couldn’t compete in a national exchange.  “They couldn’t sell insurance nationwide, so those companies would be pretty well out of business,” he said.  “It would affect the people that have coverage.  It would affect the thousands of jobs that they have here in Idaho.”