This article first appeared in the St. Louis Beacon, Oct. 19, 2012 - Last year, in a remarkable shift away from gridlock in Jefferson City, normally scrappy House members set aside their differences and voted to lay the ground work for setting up an affordable insurance exchange in line with rules in the Affordable Care Act.
An exchange is an internet-based insurance market through which small businesses, individuals and families would be able to compare insurance policies' prices and benefits. Competitive plan design and pricing would be combined with either tax breaks or subsidies to make the premiums affordable. According to the Missouri Foundation for Health, roughly 509,500 Missouri residents would get insurance through an exchange or through an expansion of Medicaid, assuming the Missouri Legislature agrees to expand that program.
The House’s first step toward setting up an exchange began to unravel in the Senate. Two GOP members, state Sens. Rob Schaaf of St. Joseph and Scott Rupp of Wentzville, eventually got legislative approval for what would become Proposition E on the November ballot. It would forbid the Nixon administration or any state agency to plan for an exchange unless the action is “authorized by a vote of the people or by the legislature.”
A” yes” vote would mean the governor’s office and state agencies would need authorization to work on an exchange; a “no” vote would allow them to act unilaterally. If the state does not set up a health-insurance exchange, the federal goverment will do so.
Jay Eastlick, director of communications for Lt. Gov. Peter Kinder, says the proposition gives voters a chance “to expressly prohibit unelected bureaucrats from implementing certain ObamaCare provisions” without approval of the Legislature or voters.
Many Republicans and Tea Party members support the initiative. “We don’t believe that the government should have the power to start a health exchange unless legislators pass a law for it,” says Jeanine Huskey, a Tea Party organizer in Eureka.
“Last year, Gov. Nixon was going around (lawmakers) to set up the exchange without (legislative) approval. Proposition E is on the ballot to make sure Gov. Nixon got the message.”
But some, such as Sidney Watson, a law professor at St. Louis University, worry that without an exchange, access to affordable insurance may be compromised.
Watson worked on a health-insurance study in rural Missouri, Health Care in the Heartland, that offered a first-hand view of the health insurance dilemma in parts of the state. Insurance was more expensive than it needed to be, she said, partly because “marketing policies to one family at a time adds about 30-to-35 percent in overhead to the cost of individual premiums.”
An exchange, she says, “creates one-stop shopping, improves transparency and accountability, and makes the marketplace function better, thus producing better quality at a more affordable price.”
Watson notes that the federal government “has already established and is operating health-insurance exchanges” to allow seniors to enroll in Medicare Advantage and Medicare prescription drug plans under which consumers are able to compare prices and benefits from several companies. This system demonstrates the federal government’s experience in designing health-insurance exchanges and operating them nationally, she says.
So far, Missouri has rejected nearly all federal funding for exchanges. It initially got a $1 million planning grant and was eligible for, but never accepted, another $20.8 million for building a portal for its exchange system. Nor did it take another $50 million in April to help the state upgrade its Medicaid information technology system. Some lawmakers objected to the $50 million grant because they said upgrading the technology was part of building an exchange.
Given that the exchange is a market-based approach to health insurance, it might surprise some that so many conservative lawmakers and groups object.
“I think the opposition is more an opposition to (President Barack) Obama and the Affordable Care Act than to this idea” of insurance exchanges, says Mark Rushefsky, professor and director of the master of public administration program at Missouri State University.
He also notes that ACA’s exchange is set up along the lines of the system that GOP presidential hopeful Mitt Romney created when he was governor of Massachusetts. But candidate Romney now argues that health reforms should be decided by individual states and not by the federal government.
Proposition E is a political relative of a referendum that outgoing Missouri Sen. Jane Cunningham, R-Chesterfield, was instrumental in putting on the ballot in August 2010. That proposal was to give Missouri voters a chance to repudiate the ACA requirement that people buy health insurance or be subjected to a fine. Roughly 70 percent of those who voted backed the referendum.
The referendum didn’t stop provisions, such as free preventive care and extension of coverage of children until age 26 on their parents' plan, from going into effect in Missouri. Nor, some say, will voter approval of Prop E derail ongoing health reform, including an exchange in Missouri, especially if Obama wins re-election.
The Missouri GOP and Tea Party views about exchanges seem to be in a minority among states. Most have taken at least some steps toward setting up exchanges. Only seven, including Missouri, have taken no action, while another seven have decided not to create state exchanges, according to the Kaiser Family Foundation. It says at least 13 states and the District of Columbia are establishing exchanges, with three others, including Illinois, planning to set up exchanges with other entities. At least 16 more states continue to study their options about setting up exchanges, Kaiser says. These numbers mean that, rhetoric aside, many states are playing it safe by keeping the door open and taking advantage of federal funds and guidance in setting up their own exchanges.
“Proposition E will have no practical effect,” predicts Rabbi Susan Talve, head of Missouri Health Care for All, because most of the health-care rules are being set by the federal government. She says Missouri should have poured its energy into designing its own exchange since ACA makes it clear that the federal government will create exchanges in states that refuse to set up their own.
