Vote to create health-insurance exchange unlikely this spring
A key downstate lawmaker who has worked since last summer to craft legislation that would create a health-insurance exchange for more than 1 million Illinoisans has given up, at least for now.
State Rep. Frank Mautino, D-Spring Valley, said he decided to try again later after seeing Republican opposition harden in recent weeks.
There aren’t enough votes among Democrats to muscle a bill through the Democrat-controlled General Assembly, he said.
“My goal has been to get bipartisan support,” Mautino said.
In the absence of legislation, it’s unclear whether Gov. Pat Quinn is preparing an executive order to set up at least the basic elements of an exchange to ensure that the not-for-profit entity could begin enrolling participants in October 2013 and start covering people with health insurance in January 2014.
The Champaign-based Campaign for Better Health Care is spearheading an online petition drive (http://www.cbhconline.org/eo-letter-quinn) calling on the governor to issue an executive order.
Quinn spokeswoman Brie Callahan wouldn’t say what Quinn plans to do.
An executive order is “one of the options and has been for the last year,” Callahan said Monday.
She said the Quinn administration “is committed to creating an Illinois-based exchange and continues to work with members of the General Assembly to prepare for it.”
‘Difficult to negotiate’
Mautino said it became obvious that bipartisan legislation couldn’t be passed in the wake of a statewide tour in April by House Republican Leader Tom Cross of Oswego and U.S. Rep. Aaron Schock, R-Peoria.
The pair questioned potential costs to the state budget of implementing an exchange and a federally subsidized expansion of the Medicaid program — both key components of the federal Affordable Care Act, President Barack Obama’s signature legislative achievement.
The Illinois Republicans’ statements, combined with oral arguments in front of the U.S. Supreme Court in March that gave many people the impression the high court would strike down all or part of the law this summer, appeared to solidify the GOP’s reluctance to proceed with legislation in the state Capitol, Mautino said.
“It just made it very, very difficult to negotiate anything,” he said.
The bill Mautino was working on would set up a nine-member, unpaid board — appointed by the governor — and would set in motion the hiring of staff to create and operate the state-regulated exchange.
Mautino said he hasn’t been able to reach consensus with lawmakers and interest groups on the qualifications of board members and how the exchange, costing an estimated $57 million to $89 million a year, would be funded.
The exchange would serve the uninsured and small businesses and dole out federal subsidies to help people afford coverage.
With more than $90 million in federal startup funds available to Illinois, the exchange would act as an online and in-person entity enrolling people, depending on their eligibility, in either private health-insurance plans or Medicaid.
$6 million for startup
Mautino said representatives of Democrats and Republicans in the Illinois House and Senate told him that many lawmakers don’t want to vote on a bill until after June, when the Supreme Court is expected to rule.
Many Republicans also want to wait until November, when Obama, a Democrat, is up for re-election and expected to face former Massachusetts Gov. Mitt Romney, a Republican who supports repealing the Affordable Care Act.
Callahan said the Quinn administration is surveying insurance companies to help determine a set of “essential health benefits” for the exchange. The administration also is developing a request for proposed contracts from businesses that would set up the exchange’s computer system, she said.
Quinn officials are “seeking federal funding available for this stage of development,” Callahan said.
It’s unclear, however, whether the state would be able to award a contract for the work without an executive order or legislative approval. Callahan wouldn’t comment on that issue.
Illinois already has received at least $6 million in federal startup funds, and an executive order or legislation are needed to prevent the state from losing out on more federal money.
Jim Duffett, executive director of the Campaign for Better Health Care, said Quinn couldn’t set up a funding mechanism through an executive order. That would require legislation, but self-sustaining funding wouldn’t be required until 2015, Duffett said.
He said Quinn could set up an initial board that is friendly to consumers and free from influence from the insurance industry.
“We hope he would set that standard,” Duffett said.
Duffett faulted Democrats in the General Assembly for failing to “step up to the plate,” and he chided the Obama administration for doing a poor job of communicating the health-care law’s benefits.
Mautino said the legislature still could vote on an insurance exchange in the fall veto session or during a special session.
The exchange would serve an estimated 776,000 people in its first year — 486,000 who receive private insurance and 290,000 who would be added through the federally required expansion of Medicaid to anyone below 133 percent of the federal poverty level (http://tinyurl.com/fedpoverty).
Enrollment in the exchange would rise to 1.7 million by 2020 — 1.4 million with private coverage and 300,000 funneled into the Medicaid program.
Schock and Cross have said they worry about the cost of the Medicaid expansion to Illinois, even though most of the cost would be covered by the federal government. Schock has said the expansion’s cost to Illinois’ budget — not covered by federal funds — would range from $1.4 billion in 2014 to $2.5 billion for the 2014-2019 period.
However, consultants hired by the state estimated the net cost to the state for Medicaid expansion in 2014 at $109.4 million. Without being more specific, the report from Wakely Consulting Group and Health Management Associates says, “State costs are likely to increase in subsequent years, as enrollment — from both currently and newly eligible populations — ramps up over time.”
Dean Olsen can be reached at 788-1543. Follow him at twitter.com/deanolsen.
*Here’s a link to the Campaign for Better Health Care’s petition drive calling on Gov. Pat Quinn to issue an executive order creating a statewide health insurance exchange: http://www.cbhconline.org/eo-letter-quinn.
*Here’s a link to U.S. Rep. Aaron Schock’s news release in which he says the federal Affordable Care Act will threaten Illinois’ already fragile state budget: http://tinyurl.com/schockhealthcare.
*Here’s link to consultants’ studies and testimony presented to the bipartisan Illinois Health Benefits Exchange Legislative Study Committee: http://tinyurl.com/3m7qvy9.