Bringing the Economy Home

Gov. Otter To Weigh Conflicting Messages In Health Insurance Exchange Decision

Darin Oswald / Idaho Statesman

Gov. C.L. "Butch" Otter, delivering his State of the State address early this year

It’s been a significant policy question for a year now: Will Idaho create a state-based health insurance exchange?  With hours remaining until Election Day, it’s a safe bet that Gov. C.L. “Butch” Otter will not make his call before the presidential vote tally is in.

When the governor does sit down to make his decision, he’ll consult his Health Insurance Exchange Working Group’s findings and recommendations, which were delivered last week.  It’s a document that contains conflicting views about the state’s options. 

For example, consulting group KPMG puts the cost of implementing a state-based exchange at $77 million, while Utah-based consulting firm Leavitt Partners estimates the cost at $25 to $30 million.

The findings also contain contradictory information about the feasibility of creating a state-based exchange by October 2013, the date by which states must demonstrate that their exchanges are functional.  Work group members write that the October deadline “seems extremely challenging at this point.”  KPMG lists the state-based exchange’s probability of success as “very low.”

Leavitt Partners, however, stresses that Idaho can create its own exchange by acting quickly, and by building on work already done by other states and private exchanges, rather than creating an exchange from the ground up.

Work group member Zelda Geyer-Silvia, the Chief Operating Officer of Blue Cross of Idaho, says that argument carried weight with the governor’s panel.  “In Idaho, we try to keep things simple,” she says.  “Some of the consultants, particularly KPMG, were basing their analysis on innovator states where they’re trying to do very different things.  But you can start more simply, rather than trying to do all of the complex processes on day one.”

Gov. Otter’s press secretary, Jon Hanian, says the governor will make a decision by Nov. 16.  That’s the deadline by which states planning to implement state-based exchanges are supposed to submit blueprints to the U.S. Department of Health and Human Services.

“When the governor issues his decision it will be about whether he will embrace that recommendation, reject it, or come up with something different,” Hanian says.


Health insurance exchanges are a key component of the Affordable Care Act, often called “Obamacare.” They’re most often described as online marketplaces that let consumers compare and purchase health insurance.

A number of groups convened to study the issue have recommended that Idaho pursue a state-based exchange.  It’s the best way for the state to maintain control of its own health insurance market, they’ve concluded.  But there remains a not insignificant contingent that favors inaction in hopes of undermining the Affordable Care Act.

That view was perhaps most powerfully represented by House Speaker Lawerence Denney (R-Midvale) and House Majority Leader Mike Moyle (R-Starr), who issued a joint statement in July, calling for Idaho to “resist Obamacare.”

Reached today, Rep. Moyle questioned whether Gov. Otter can, in fact, issue an executive order determining, for example, that Idaho will pursue a state-based exchange.  “My understanding is that, in order to do it, there’s going to be statute involved,” Moyle says.

Gov. Otter’s chief of staff, David Hensley, and Idaho Department of Insurance Director Bill Deal could not be reached for comment.


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