W.Va. and feds to share health insurance exchange
When West Virginians sign up for subsidized health insurance under the federal health-care law overhaul, they'll likely tap an "exchange" set up as a partnership between the state and federal government, Gov. Earl Ray Tomblin's aides told state lawmakers Monday.
The state-federal partnership costs less and allows West Virginia to have a say in some of the health insurance exchange's regulations, said Rob Alsop, Tomblin's chief of staff. He called the partnership the "best alternative" for the "cards we've been dealt."
"The governor's approach is quite simple," Alsop told lawmakers during a joint House-Senate meeting Monday. "If you have a seat at the table, and we can do what's right by West Virginians, then we should do that."
West Virginia, like other states, also had the option to run its own health insurance exchange – or turn the entire program over to the federal government.
At least 16 states and the District of Columbia have announced plans to run exchanges themselves. Another 18 states plan to leave the exchange in the hands of the federal government.
Seven states, including Ohio and now West Virginia, are proceeding with the hybrid approach.
The federal government does most of the heavy listing under a shared exchange. West Virginia would play a minor role – perhaps monitoring insurance companies that participate – once the exchange is up and running on Jan. 1, 2014.
"Our tentative plans are to proceed with the state partnership exchange to retain the ability to assist consumers and industry, while avoiding the financial liability of a state-based exchange," said Jeremiah Samples, a state Insurance Commission employee who's heading the project. "We're still working out details with the federal government of what exactly the partnership entails."
Samples said it would be difficult to sustain a state-operated health insurance exchange because of exorbitant information technology costs.
"A state-based exchange is unfeasible at this time due to the fiscal burden on consumers, industry and the state," Samples said.
Meanwhile, West Virginia would have had to relinquish all control if the federal government operated the exchange, he said.
"The full federal exchange was deemed to create too great a regulatory burden for consumers and industry," Samples told lawmakers.
The state Insurance Commission estimates that 37,000 to 60,000 West Virginians will seek health-care coverage through the new online health insurance marketplace.
West Virginia has received $10.6 million in federal grants to set up the program.
The program will allow consumers to go online – or over the telephone – to shop for health insurance at discounted rates.
"The exchange is the marketplace for obtaining health-care coverage," Samples explained. "The exchange serves as a one-stop shop. [It's] available to all consumers."
The exchange is expected to cost about $12 million in 2014, and about $10.7 million in 2016, according to a report presented to state lawmakers Monday.
House Health Committee Chairman Don Perdue said he would have preferred a state-run health insurance exchange, but understands the governor's decision to partner with the federal government.
"There was a concern we couldn't sustain the program," said Perdue, D-Wayne.
Samples and Alsop said the state could decide to operate its own program in future years, after evaluating the state-federal partnership.
West Virginia also could join another state's exchange or a multi-state partnership.
"From year to year, a state can modify its approach," Alsop said.
Samples said he plans to meet with "stakeholder groups" – consumers, medical professionals and insurance company representatives – in the coming months.
The state has until Feb. 15 to submit detailed plans about the partnership exchange to the federal government.
"There's a lot of information we have to continue to sift through that we will continue to assess," Samples said. "There's a tremendous amount of work." Reach Eric Eyre at firstname.lastname@example.org or 304-348-4869.