Politics & Government

Kentucky's health insurance exchange moving forward without legislative vote

FRANKFORT — Kentucky's online insurance marketplace, a key component of the federal Affordable Care Act, will go into effect without a vote by a state legislative committee.

At the urging of Republican members, the Interim Joint Committee on Health and Welfare delayed a vote in August on regulations crafted by Gov. Steve Beshear's administration that would establish a health benefits exchange.

Beshear authorized creating the exchange by executive order July 17. The regulation automatically goes into effect if the legislative committee does not act to block it within 60 days, but the committee isn't scheduled to meet again until Sept. 19.

House Speaker Greg Stumbo, D-Prestonsburg, declined a request for a special meeting of the committee from State Rep. Tom Burch, the Democratic co-chairman of the committee. Brian Wilkerson, a spokesman for Stumbo, said Stumbo rejected the request because of budget constraints.

However, Senate President David Williams, R-Burkesville, said the legislature could have simply moved the regularly scheduled meeting forward a few days rather than call a special meeting.

A special meeting would cost taxpayers at least $7,500, Burch said. That's due in part to per diem salaries and travel expenses for legislators on the committee.

Even if the committee had voted against the regulations, Beshear would have had the authority to override their decision. "It was going to be approved whether we approved it or not," Burch said.

During the August meeting, Republican legislators questioned the costs of setting up the exchange.

This summer, another legislative committee denied a plan by Beshear to spend $300,000 leasing office space for the more than 200 employees the exchange is expected to employ. The Beshear administration overrode the committee's decision and signed the lease.

The online insurance marketplace will allow consumers who do not have private insurance or Medicaid to comparison shop for the best plans and the best prices.

At the August meeting, officials with the exchange told legislators that the federal government will pick up the tab for start-up costs for the exchange, which is supposed to be operational by Jan. 2014.

However, there were questions about how the state would pay for the exchanges in future years.

State officials said the exchange would generate money to help offset its costs. Also, money that has been set aside for a high-risk insurance pool for people who don't qualify for regular insurance could also be used to pay for the exchange. That high-risk insurance pool is paid for in part by fees charged to insurance companies.

Sen. David Givens, R-Greensburg, said Thursday that many legislators were confused about the future funding of the exchange and those questions still remain.

"I think due to the unanswered questions, we felt that it needed to be vetted further," Givens said. "They indicated that the insurance companies were going to pay a fee but they didn't know what those fee rates would be and they didn't know if the fee rates would be enough to fund the exchange. Ultimately, the insurance provider is going to pass that cost on to someone."

Burch said Republicans wanted to make the issue political because it's an election year. "They had their chance to put their stamp of disapproval on it and it didn't work," Burch said.