Colorado Joining States Fighting Creation of Health Insurance Exchanges

Quite a few states are fighting the requirement in the new health care law to set up health insurance exchanges (HIXs), the grab bag of insurance policies residents will now be able to compare and choose from.

A special legislative committee said yes to Colorado on Thursday to continue working on its health insurance exchange by allowing it to apply for a $43 million federal grant, according to a story by Eric Whitney. But it wasn’t quite that easy. Lawmakers had to fight about it first. Five Republican state lawmakers have the power to quash the work done so far on the exchange, Whitney wrote in another story.

The latest battle follows the most controversial and contentious fight of the 2011 Colorado legislative session, focusing on the so-called exchange bill. The bill said Colorado should move forward with creating an Internet marketplace where people could choose health coverage plans once such insurance is mandated by the federal health care law, Whitney reported.

“Republican Amy Stephens, the former House majority leader, corralled enough Republican votes for the bill to pass the General Assembly by arguing that Colorado needed to set up its own exchange, because if it didn't, the federal government would set one up for the state,” he wrote.

"Given our situation, what's right for Colorado, what's right from a state's rights perspective, this is probably one of the more proactive and better positioned things that we could do for our state," as Stephens told Whitney.

The law allowed the state to set up a board to create Colorado's own exchange, using federal grant money. But Republicans went one better – creating a special legislative committee that has to approve every exchange grant application. Last week, they showed their displeasure with the state’s biggest exchange grant application to date, for $43 million, Whitney revealed.

Whitney noted that Republican Sen. Kevin Lundberg of Larimer County said earlier this week he wanted to know how the exchange will sustain itself when the federal grants to set it up run out, certainly a legitimate question.

The exchange is supposed to be “kind of like an Internet travel service - you plug in your information about your age, health and income, and you get a list of options for coverage and prices,” Whitney worte. The exchange is set up to be “one-stop shopping for consumers who can come to the site and find out if they are eligible for Medicaid or federal subsidies for insurance.” Possibly insurers who do business in the state may be one source of funding.