JFAC has set a new budget for the state Department of Insurance, after the previous one was pulled from the House because some House Republicans objected to accepting $2.5 million in federal grants for the state to do preliminary planning work on setting up Idaho's own health insurance exchange. Under the new bill, the department could spend $500,000 of its own dedicated funds, which come from fees paid by insurers, "to protect state regulation from federal encroachment." Those funds otherwise would have flowed to the state's general fund, so it's equivalent to tapping state general funds. If Idaho doesn't set up its own exchange and the lawsuit over national health care reform fails, the state would be subject to the feds taking over the task and moving into regulation of Idaho's insurance industry. Bell said the new budget as written would "ensure that the insurance industry is regulated by a local entity. It's a firewall for us."

Rep. Shirley Ringo, D-Moscow, said, "I really liked our appropriation as it was before, and this almost feels a little bit like a chest-thumping activity." But the new version passed on a 16-4 vote - not a party-line vote, however. Sen. Diane Bilyeu, D-Pocatello, voted in favor, and Sen. Joyce Broadsword, R-Sagle, vice-chairwoman of the Senate Health & Welfare Committee, voted against it. The new budget bill replaces the earlier one that had passed the Senate, and now must pass both houses.