House Passes Bill To Block Funds for State Insurance Exchanges
On Tuesday, the House passed legislation (HR 1213) that would block mandatory funding for state-based health insurance exchanges created under the federal health reform law, the AP/Washington Post reports (AP/Washington Post, 5/3).
The measure passed 238-183, with five Democrats joining all House Republicans in support of the bill. Before the vote, the House rejected five Democratic amendments and a motion to recommit that would have prohibited insurers from participating in exchanges that deny coverage or increase premiums based on pre-existing conditions (Attias, CQ Today, 5/3).
The Congressional Budget Office said the legislation would cut $14 billion from the deficit, mostly from delaying the exchanges. The agency estimated that without federal money, states would not be able to implement the exchanges until 2017, instead of the 2014 deadline in the reform law (McCarthy, National Journal, 5/3).
During the floor debate on the legislation, Democrats argued that revoking federal funding would limit states' flexibility in developing the exchanges. Rep. Frank Pallone (D-N.J.) said, "The exchanges won't go away with this legislation," adding, "It's simply going to mean the states can't do a good job, or they're going to yield that power to the federal government and you'll have a national exchange."
Under the health reform law, the federal government must step in to develop an exchange if a state fails to do so. However, Republicans argued that the law gives HHS unlimited spending power (CQ Today, 5/3).
The bill is unlikely to pass in the Democrat-controlled Senate, and the White House on Monday threatened to veto the measure (National Journal, 5/3).
States Do Not Require Laws To Establish Exchanges, HHS Says
In related news, HHS officials on Tuesday said that many states do not have to pass legislation to start creating health insurance exchanges, CQ HealthBeat reports.
According to the agency, a governor can issue an executive order to create the exchange, if state law permits it. Some state officials are exploring the strategy as a way to develop the exchanges without subjecting lawmakers to further criticism from conservative groups (Reichard, CQ HealthBeat, 5/3).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.