Health exchange meeting draws opponents

Tea Party members express misgivings

Associated PressJanuary 25, 2013 

FRANKFORT — Tea Party activists spoke out Thursday in favor of dismantling Kentucky's new health insurance exchange. The exchange is being launched as a way for individuals and businesses to shop online for health coverage in a state plagued by high disease rates.

A dozen or so of the conservative activists attended a board meeting for the Kentucky Health Benefit Exchange, which will offer a website that's supposed to make picking health insurance similar to buying an airline ticket from an online travel site. The exchange will allow consumers to compare costs and benefits from various health plans. They'll also be able to find out if they are eligible for government help with their premiums for private insurance.

About 300,000 people are expected to purchase their health insurance through the statewide exchange, said its executive director, Carrie Banahan.

"It's going to be very consumer friendly," she said in an interview.

Tea Party activist David Adams said the exchange creates an unaccountable bureaucracy with too much influence over Kentucky's health-care system.

"I want this whole thing to go away," he told reporters after the advisory board met.

Adams voiced support for a bill that would require legislative approval of the exchange. The measure, sponsored by a handful of Republicans, was introduced in the GOP-led Senate during the first week of the 2013 General Assembly session that resumes next month. Democrats control the Kentucky House.

Gov. Steve Beshear issued an executive order last year to create the statewide exchange. It's set to open on Jan. 1, 2014. He was among a group of governors who chose to have their states set up and run their own health insurance markets. A number of states turned down the offer to run the markets, putting the task on the federal government.

Adams said Kentucky's exchange is exerting taxing authority it doesn't possess, and said that's among the reasons its existence should be tied to legislative approval.

"If we took a vote of the people, which we haven't done, the people would not allow them to have this power," he said of the exchange.

A federal grant will cover the exchange's operations in 2014. After that, the exchange will rely on an assessment on insurers to help pay its yearly expenses, estimated to be about $39.5 million. A portion of Kentucky's share from a national settlement between most states and a group of tobacco companies will also help cover the exchange's costs. No state general fund dollars will be used to pay for the exchange, said Jill Midkiff, a spokeswoman for the state Cabinet for Health and Family Services.

Banahan said the same combination of money from the assessment on insurers and the tobacco settlement has been used to support the state's high-risk insurance pool for people unable to obtain private insurance coverage because of chronic health problems.

Exchanges are a key part of President Barack Obama's health-care overhaul. The new law also forbids insurers from turning away the sick, limits what they can charge older people and bans gender-based surcharges. It also requires virtually all Americans to get coverage or face fines.

Adams said Kentucky should opt out of running its own exchange, which would shift the task to the federal government.

"It's going to be substantially cheaper ... for Kentucky citizens to have the state government get out of this and leave it alone," he said.

Cost isn't his only motivation in wanting Kentucky to shift control of the exchange to the federal government. If the federal government is saddled with operating a number of state exchanges, the entire health-care law will unravel, Adams said.

"I make no bones about it, I don't consider this whole exercise anything that's going to benefit consumers generally or taxpayers at all," he said. "What happens if the federal government runs the exchanges ... the whole thing just falls apart." Adams said he supports a free-market system for health care.

Banahan said Kentucky can better shape an exchange that best fits the state's needs.

"With the federal government it's a one-size-fits-all approach. The needs in Kentucky are different than the needs in other states," she said. Banahan said progress is being made in setting up the website to help consumers pick health insurance coverage.

"The exchange gives Kentucky an opportunity to increase access and affordability to health insurance coverage," she said.

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