LSJ: If State Fails to Create Exchange, the Feds Will — and Stick Us with the Bill

If State Fails to Create Exchange, the Feds Will — and Stick Us with the Bill
By Don Hazaert

November 6, 2011 Lansing State Journal

The state Legislature is working with various stakeholders to determine how and when to comply with a federal law requiring all states, including Michigan, to create a new service to help consumers and small businesses shop for health insurance.

Gov. Rick Snyder and key legislative leaders want state lawmakers to pass Senate Bill 693 to create the new website and service — called MiHealth — before Thanksgiving.

We know now why the governor and key lawmakers are moving with urgency.  States must act, in a relatively short timeframe, or risk losing decision-making authority not only over the new MiHealth marketplace but also over aspects of other federally subsidized healthcare programs.

At a state Senate hearing last week, it was affirmed that if lawmakers abdicate their responsibility to create a consumer-focused online marketplace they will likewise cede control over eligibility, enrollment and IT decisions related to programs like Medicaid and MiChild.  The federal government will assume those duties and then hand Michigan taxpayers the bill for much of the work.

States that create healthcare exchanges not only will maintain autonomous control over their state-administered health plans for adults and children, the federal government will also pay the costs of creating the exchanges. These funds are vital in allowing the state to bring on board the staff and expertise necessary to properly design MiHealth and integrate the technologies necessary to make the new online service operate properly for consumers.

Senate Bill 693, introduced by Sen. Jim Marleau, R-Lake Orion, would create a website where Michigan consumers and small businesses can shop for the health insurance plan that is best for them and their families. This important legislation is pending in the Senate Health Policy Committee. Michigan Consumers for Healthcare (MCH) — the consumer voice for affordable, accessible, quality health care in Michigan, with more than 90 member organizations — joins Gov. Snyder in urging immediate passage of the bill.

People who support market competition and consumer protections should recognize that a competitive marketplace would give consumers more control, quality choices, and better safeguards when buying health insurance. MiHealth will establish an easy-to-use website similar to Travelocity or Orbitz — as well as a toll-free call-in center — that will allow consumers to make real comparisons between plans so that they can find one that meets their needs and budget.

This is common sense legislation. Small businesses that traditionally have lacked the purchasing power of big businesses when it comes to health insurance will benefit. Individuals who have insurance and those who don’t will benefit.

Here’s the bottom line: Michigan stakeholders can work together to create the best marketplace for Michigan, or we can let the federal government impose one on us. We should, as a state, make the logical and smart decision before we lose that opportunity to make our own decisions regarding a health care marketplace. State lawmakers should act in the best interests of individuals and small businesses by passing SB 693.

(Don Hazaert is Director of Michigan Consumers for Healthcare based in Lansing.)