GOP govs of Iowa, Neb. differ on health exchanges

Associated Press Published: November 18, 2012
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LINCOLN, Neb. (AP) — Iowa and Nebraska are turning down different paths to comply with the federal health care overhaul, which reflects the broader struggle many Republican governors face now that they must submit to a law they feverishly oppose.

Iowa Gov. Terry Branstad said Friday that his administration will continue to work on a state-based exchange, but he left open the possibility of defaulting to a federal exchange or some combination of the two. In Nebraska, Gov. Dave Heineman declared the state-based exchange too expensive and told the federal government to build one for his state.

Heineman and Branstad both insist that they're making a good-faith effort to follow the law, despite a frustrating lack of guidance from the federal government. But Democrats in both states who closely follow health care say the governors haven't done nearly as much as they could have to prepare, betting instead that Mitt Romney would win the presidency and make good on his promise to repeal the law.

This week, the governors had to choose: Launch a state-run health insurance exchange — billed as the best way to maintain local control — or toss it back to the federal government?

At least 17 states and the District of Columbia have committed to creating their own exchanges, five have said they will partner with the federal government, and seven were still pondering their decision. Twenty-one others have decided to let the federal government run the exchanges.

Supporters of the health care law say the exchanges will work for consumers, regardless of who runs them. But the choice could determine how well they function, how competently they're managed, and how easy they are to access.

For instance, will the federal government realize that Internet service is easier to find in Omaha than in rural, western Nebraska? And if that's the case, does western Nebraska need more brick-and-mortar facilities to help residents buy insurance?

"This isn't a giant federal exchange — this is the feds coming in to set up a Nebraska exchange," said Jennifer Carter, a policy director for the public-interest group Nebraska Appleseed. "That may be why not doing a state option was a little bit of a missed opportunity. We can deal with the opportunities and challenges here in Nebraska. But I hope the federal government will be asking for local input, and that the state and others will cooperate so there won't be a really big difference for consumers."

Heineman said he struggled to decide which approach was best, but concluded that a state exchange was too costly for Nebraska taxpayers.

He said a state exchange would force the Nebraska Department of Health and Human Services to tap into federal databases, which would require new software. The state Department of Insurance, meanwhile, would have to pay for a website, call centers, an insurance billing system, supplies and office space.

Heineman said the state has tried to exert control over different aspects of the health care law, but was thwarted by the federal government.

He pointed to the state's efforts to set minimum coverage requirements for Nebraska residents, known as an "essential benefits plan." The health care law lists 10 broad categories of essential benefits, including preventative care, emergency services, prescription drugs and hospital services.

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