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Idaho Adopts State Health Insurance Exchange

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The first regular session of the 62nd Idaho Legislature was 88 days in length, adjourning on April 4. During this time 545 pieces of legislation were introduced and, of the 545, bills introduced, 356 were passed by the Senate and House and sent to the Governor. The Governor vetoed two of these bills and 354 became law, with the majority becoming effective July 1 of this year.

One of the most controversial pieces of legislation was House Bill 248 (H248) that establishes a state-based Health Insurance Exchange. This legislation was first introduced as Senate Bill 1042 and passed the Senate on a 23 to 12 vote. At the same time the House Health and Welfare Committee drafted a similar bill, House Bill 179, that also provided for a state implemented Health Insurance Exchange. 

Both of these bills were held in the House and replaced with H248, which incorporated the best provisions of both bills. H248 passed the Senate and House and was signed into law by the Governor. 

Implementation of a Health Insurance Exchange is required under the Federal Patient and Affordable Care Act (PPACA), also referred to as “Obamacare.” Under the Act, a state has the option of adopting a state operated health insurance exchange or leaving implementation of the exchange to the federal government. 

As I related in a previous Journal article, the question of how to respond to the health insurance requirement of the federal legislation was extremely controversial.

Idaho Governor Otter and the Idaho Legislature have fought hard against the federal health care law and many Idaho legislators opposed to the Federal Patient and Affordable Care Act opposed establishing a state exchange, believing that the federal government would be unable to implement a federal exchange without the majority of states participating and the requirement would become a non-issue.

Other legislators, believing that there were only two choices (a state health insurance exchange or a federally implemented health insurance exchange), favored a state exchange thinking that the state was better positioned to implement an exchange that would meet Idaho citizens’ needs more effectively and less costly than a federally implemented program.

H248 passed the House on a 41 to 29 vote and the Senate on a 23 to 12 vote.

Given the controversy over the Health Insurance Exchange and in response to questions I have had on the issue, it seems good to discuss what an exchange actually is to help with understanding the intent of a health insurance exchange.

Beginning in 2014, most Americans will be required to have a health insurance plan that contains basic minimum standards. Those who do not, and are not exempt because they have insurance under private coverage or government coverage under Medicare or Medicaid, will be subject to a penalty collected through the Internal Revenue Service.

A health insurance exchange provides a marketplace for those needing to purchase health insurance to meet this federal requirement. Very simply, a health insurance exchange “is an internet-based marketplace for qualified health insurance plans that will be sold the way travel websites such as Orbitz or Expedia sell airline tickets.”

The Idaho Health Insurance Exchange “will offer a choice of different health plans provided by companies offering policies that meet federal requirements, and will also provide information and assistance through a manned call center located in Idaho to help consumers better understand their options.”

Individuals buying their own coverage and businesses with 50 or fewer employees will be eligible to purchase insurance through the exchange. However, it is important to understand that not all individuals or companies have to buy insurance through the exchange. Participation in the exchange is completely voluntary; most Americans will continue to get insurance through their employers or thorough their own private policies unless purchasing through the exchange would provide the same or better coverage at a lesser cost.

No state money will be needed to create a state-based health insurance exchange. H248 provides for a “not-for-profit Health Insurance Exchange. The initial implementation and operation of the Idaho Health Insurance Exchange will be funded by federal grants but the continuing operation of the exchange will be “funded by exchange participants through user fees or assessments.” 

A 19-member Idaho Health Insurance Exchange Board, authorized by the legislature to set the rules and regulations for implementing the state-based exchange, will govern the Health Exchange. 

In summary, those legislators who supported H248, including myself, did so for two reasons: 

 1) The state would have some flexibility in developing a program that would meet the needs of Idaho citizens better than a federal program of “one size fits all” that relies on national insurance statistics as opposed to individual state insurance statistics.

 2) That a state-based exchange will cost less than a federally implemented exchange for those having to purchase insurance through the exchange for the following reasons:

The Idaho Exchange will avoid the federal fee of 3.5 percent on insurance policy premiums

A state-based exchange allows Idaho to control the operational costs of the exchange.

An Idaho exchange will rely on existing state agencies to perform the regulatory functions they now perform.

I hope this information is helpful for those readers wondering how and if a state implemented insurance exchange impacts them.

Since the legislature adjourned on April 4 I can be reached at my home address of P.O. Box 112, Dover or by email at: geskridge(at)coldreams.com or by phone at (208) 265-0123.

Thanks for reading!

George

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Rep. George Eskridge Rep. George Eskridge the Republican Representative for District 1 in Idaho’s House, George Eskridge can be reached at 208-265-0123 or write PO Box 112, Dover, ID 83825

Tagged as:

Obamacare, Affordable Care Act, A Seat in the House, health insurance exchange

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