Corbett: State will not set up own insurance exchange
Pennsylvania will not be setting up a state health insurance exchange, but will defer to the federal government to operate the exchange under the Affordable Care Act.
In a statement issued Wednesday, Gov. Tom Corbett said his decision not to set up a state-based exchange was due to the fact that his administration has not received answers to questions from the federal government posed over the last two years “to help determine costs, impacts and flexibility in order to inform our decisions.”
In a Dec. 12 letter to U.S. Department of Health and Human Services Secretary Kathleen Sebelius, Corbett wrote, “Although the recent publication of proposed regulations provided some guidance, even you have admitted these rules are not final. And your answers this week — less than five days from the deadline for a decision for a state-based exchange — while greatly appreciated, still require significant review along with the regulations.”
For these reasons, Corbett said in the statement, “I have decided not to pursue a state-based health insurance exchange at this time. It would be irresponsible to put Pennsylvanians on the hook for an unknown amount of money to operate a system under rules that have not been fully written.”
In his letter, Corbett said he had “strong concerns” that the state “would end up shouldering all of the costs [of the exchange] by 2015, but have no authority to govern the program,” and that three were “too many unknowns.”
“We must work together to provide more health care access,” he wrote, but noted concern over the costs of Medicaid expansion in the state, which he said “could reach more than $4 billion in state-only costs over the next eight years,” leading to substantial tax increases.
In a statement issued following Corbett’s announce- ment, U.S. Rep. Allyson Schwartz, D-13, criticized the governor’s decision, calling it “a lost opportunity … to demonstrate leadership and innovation in affordability and accessibility in the insurance marketplace.”
“Gov. Corbett’s decision not to accept the authority to develop and operate a state ‘exchange’ marketplace of private health coverage for individuals and small businesses is a failure of leadership and vision,” Schwartz said.
Schwartz, who is rumored to be planning a run for governor in two years, noted in the statement her efforts as a state senator to create Pennsylvania’s Children’s Health Insurance Program, which she said was one of the first in the country and later used as a model for federal efforts to offer affordable insurance coverage for 11 million children nationwide, and her effort as a congresswoman to expand that coverage at the federal level. She criticized Corbett for ending the AdultBasic program — started with money from the tobacco industry settlement to offer coverage “to thousands of lower income middle class adults in Pennsylvania” — by “using the funds to cover budget shortfalls, leaving many in Pennsylvania uninsured.”
Acknowledging “there are unanswered questions, as there are with all new ventures, the governor’s decision demonstrates the low priority he has given to the serious challenge of affordable, accessible health coverage for our citizens,” Schwartz said.
“The federal government will now take the responsibility to establish an exchange for Pennsylvania so that our residents will have access to affordable, meaningful coverage,” she said.
Pennsylvania is one of 28 states that have decided to have the federal government operate their state’s exchange, according to the governor’s statement. The decision to establish a state-based exchange can be re-evaluated each year, it says.