Idaho Senate backs health insurance exchange

BOISE – After a six-hour debate, the Idaho Senate voted 23-12 Thursday in favor of Gov. Butch Otter’s state health insurance exchange bill, marking a key victory for the GOP governor and sending his signature proposal of the legislative session to the House.

Outnumbered opponents extended the debate – which ran from 9:45 a.m. to nearly 4 p.m. – asking questions, proposing motions that were voted down and threatening to go even longer.

Under the national health care reform law, states can choose to set up their own exchanges – Internet-based portals where residents can shop for health insurance plans and access federal subsidies – or the federal government will run exchanges for them.

“The facts are that the federal law says that we will have an exchange of some type,” said state Sen. John Tippets, R-Montpelier, the bill’s lead Senate sponsor. “I thoroughly believe that the state is going to be able to do a much better job of administering a program like this than the federal government.”

Otter has been clear that he’s heard an earful from other Republican governors who’ve chosen to resist any involvement with the national health care law on principle, even if it means their states get federally run exchanges. But after months of study by a task force he appointed, Otter said he concluded that a state exchange would better protect Idaho’s sovereignty and would save Idahoans money.

“You do not weaken the federal government by defaulting to them,” state Sen. Dean Cameron, R-Rupert, told the Senate. “You do not weaken the federal government by abandoning the field of battle. … You make them stronger.”

Cameron said Idaho, which has some of the nation’s lowest health insurance rates, has the most to lose if it lands in a federal exchange. Idahoans would pay more, he said.

Sen. John Goedde, R-Coeur d’Alene, who like Cameron is a licensed insurance agent, said Idaho’s insurance industry would lose out under a federal exchange, which likely would focus on national companies rather than Idaho insurers.

State Sen. Sheryl Nuxoll, R-Cottonwood, was among the most outspoken opponents of the bill. “Well, are we a state or not?” she asked the Senate. “Do we want our businesses running to other states because we’re setting up this exchange and they want to avoid all the regulations and all the penalties?”

Nuxoll also argued that a state exchange would cover contraceptives that she considers akin to abortion, and attempted unsuccessfully to amend the bill to forbid that. Opponents of that move said there’s no difference between a state and federal exchange on contraceptive coverage, but noted that Idaho has already passed a law to forbid coverage for elective abortions from being offered through its exchange, whether it’s state-run or federally run.

Sixteen House GOP freshmen, led by state Rep. Luke Malek, of Coeur d’Alene, have pledged to support the governor’s bill only if their own bill, which would require more legislative oversight of the exchange, first passes both the House and Senate. That measure is up for a House committee hearing on Monday.

Otter has praised the House freshmen’s bill, HB 179, saying it “complements” his measure, SB 1042.

The governor’s bill sets up Idaho’s exchange as a quasi-governmental agency overseen by an independent board. It could not receive any state tax funds and would have to be self-supporting through fees. It would be voluntary for anyone to participate in the exchange, either as a customer or as a provider of insurance.