Nebraska should not wait for the U.S. Supreme Court to rule on the Obama administration’s health care overhaul before it prepares a state-based insurance exchange, a leading hospital advocate said.
Bruce Rieker, a lobbyist for the Nebraska Hospital Association, said it’s crucial that lawmakers address the issue during the regular legislative session set to run January through April.
Rieker said the state needs a budget and oversight plan in place before the June 29 deadline. States that miss the deadline risk losing millions in federal aid to help set up exchanges. The Supreme Court is expected to rule on the case by June.
The hospital group “feels the urgency for the Legislature to tackle this situation sooner than later,” Rieker said. “It may not result in a bill being passed in this upcoming legislative session, but we need to have the discussion.”
The state exchanges are meant to offer a one-stop-shop for Americans to buy health insurance. They must be federally certified by January 2013, operational by 2014 and self-sustaining by 2015.
Millions of uninsured Americans will be able to buy private coverage through the online supermarkets starting in 2014, with taxpayer assistance to help cover the premiums. The Nebraska Department of Insurance has predicted that a family with two children that makes $55,125 per year could pay an estimated $370 per month because of the income caps and subsidies.
Nebraska Gov. Dave Heineman, a Republican, has said he would prefer to wait for the ruling before the state commits to a plan. State insurance officials say the federal government still hasn’t set minimum requirements for the exchanges.
Rieker said it’s crucial to set up the exchange before federal rules allow more Nebraskans to qualify for Medicaid in 2014. The exchanges will help determine who qualifies for the program built for low-income and disabled Americans.
About 225,000 Nebraskans — one out of eight — are eligible for Medicaid under current federal guidelines. When eligibility expands, the number will grow to nearly 390,000 — about one in five Nebraskans.
Advocates who testified before the Legislature’s Banking, Commerce and Insurance Committee overwhelmingly supported a state-based insurance exchange for Nebraska, instead of deferring to a federal takeover for states that fail to act.
“The creation of an exchange will be a significant step forward to providing additional access to affordable health care for thousands of Nebraskans,” said Andrea Skolkin, chairwoman of the Health Center Association of Nebraska.
Skolkin said Nebraska’s six federally certified centers served 63,330 patients last year, and 93 percent had incomes no greater than 200 percent of the federal poverty line. More than half were uninsured.
The U.S. Department of Health and Human Services announced this week that 13 states will split grants totaling nearly $220 million to help set up health insurance exchanges. Seven of those states, including Nebraska, are suing to overturn the federal health care law.
The state-based exchange is one of four options Nebraska is considering, but appears to be the most likely. States also can participate in federal or regional exchanges, or a state-federal partnership.
About 205,000 Nebraskans are uninsured, or 12 percent of the population, according to a Department of Insurance report. The national average is nearly 17 percent.
Several lawmakers on the panel said they were concerned the exchanges would inflate costs that are already unsustainable.
Sen. Mike Gloor of Grand Island, a former hospital CEO, said providers should “have some skin in the game” and patients should have incentives to control spending under the exchange Nebraska enacts.
“We’re talking about the potential for a huge, uncontrolled inflationary increase that undermines all the good things that could happen as a result of insurance exchanges,” he said. “I don’t know what the real answer is, except I think it’s something that has to be talked about.”
The issue could flare into a larger political battle when lawmakers convene in January. The Nebraska Democratic Party has criticized the hiring of two insurance analysts, questioning their qualifications and political activities.
The analysts, Mike Sciullo and John Paul Sabby, were hired last year to help Nebraska proceed with the health care effort and prepare a report for lawmakers. Both were videotaped at a Las Vegas protest last year, with Sciullo dressed as Uncle Sam declaring that “government is always oppression.”
Department of Insurance Director Bruce Ramge has defended the analysts.
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