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November 16 2011

Panels look at state exchanges, soaring costs stemming from health law

Olympia Business Watch

Does it make sense for Washington [state] to press ahead with development of a state health insurance exchange, or would it make sense to slow down and learn from the experiences other states encounter?

Jeff Gingold, moderator for AWB's Health Care Forum, put that question to a panel made up of state Sens. Randi Becker, R-Eatonville, and Karen Keiser, D-Kent, and Molly Voris, health benefit exchange project manager for the state Health Care Authority.

The answers offered a glimpse of the differences that exist among the lawmakers and officials responsible for implementing Washington's health insurance exchange.

"Why wait?" responded Keiser. "I don't see why we would hang back," she said, adding that Washington has made mistakes but officials have learned from them.

Voris likewise argued for moving forward, saying the state has a better chance of crafting its own exchange and influencing the federal goverment.

But Becker said she isn't necessarily a fan of being No. 1. The state needs a strategic plan rather than change for the sake of change, she said, and she noted the significant questions that remain unanswered about how the federal health law will work.

The panel discussion was one of three held during a forum aimed at helping employers make sense of the federal health care law.

The first panel consisted of Michael Tanner, senior fellow at the Cato Institute; Hadley Heath, senior policy analyst with the Independent Women's Forum; and James Capretta, fellow at the Ethics and Public Policy Center.

Together, the panelists offered insight from both the federal and state level about what's happpening with the law, and where it is going.

Everyone agreed there are plenty of unanswered questions regarding the law, but Tanner said one thing is clear: "Whatever the other merits of this bill, it's going to cost us," he said.

It's going to cost more in federal and state taxes, federal debt and higher insurance premiums. "You're paying a lot for it," he said.

State governments, already struggling huge budget shortfall, will be required to spend more money on Medicaid as a result of the expansion of that program, Heath added. "Every public school teacher should be opposed to Medicaid expansion," she said because of the competition it poses to education funding.

As officials move forward with implementing the law, Capretta noted a shift in the way the Obama administration is engaging with both state officials and insurance companies. At one point, the Health and Human Services secretary sent a harsh letter after an insurance company went "off message" and said the health law would drive up costs.

Now they've reversed course. "They're totally milquetoast," Capretta said. "They can't tell you anything." The apparent strategy, he said, is to generate as little controversy as possible through 2012 and then implement everything in 2013.

As Washington officials move forward with developing a health insurance exchange, Gingold asked the state panel how important it is to retain a vibrant insurance market outside of the exchange.

Competition is vital, said Becker, noting the mass exodus of insurance companies from the state after new regulations were adopted in the 1990s. She said she wants to find a way to bring more carriers into the state.

Keiser agreed that competition is good, but she emphasized the need to protect consumers and maintain a "sound insurance market."

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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