House committee rejects state-run health exchange

By Andrew Schulman, Daily News Editor
Published November 29, 2012

A Michigan House of Representatives subcommittee voted Wednesday to nix a bill proposing the creation of a state-run health care exchange under the federal Affordable Care Act.

The decision likely halts the possibility of Michigan running its own exchange as the Dec. 14 deadline and the end of the legislative term near. The state House Health Care Policy Committee ultimately decided in a 5-9 vote, with two abstentions, meaning that an exchange jointly run by the federal government and the state is the most probable course for the implementation of the Affordable Care Act.

Republican Gov. Rick Snyder, who advocated for a state-run exchange earlier this year, supports the federal-state partnership, as do state Democrats. However, state Republicans, who control both chambers of the state Legislature and the committee, have opposed the implementation of the exchange as part of their resistance to President Barack Obama’s health reforms.

Anticipating opposition in the state Legislature and facing the Dec. 14 deadline, Snyder filed a letter of intent for federal-state cooperation in the creation of an exchange, according to Kurt Weiss, a spokesman from the Michigan Department of Technology, Management and Budget, which helps the state implement various projects and initiatives.

Wednesday’s decision by the committee does not change his commitment in the letter to the federal government, Weiss said.

“We’re going to continue down the path of the partnership exchange,” he said.

The bill failed in committee partially because of Republican resistance to the Affordable Care Act and partially because state Republicans used what is called a “tie bar” to link the decision on the exchange to the fate of anti-abortion bills in the state Legislature, said state Rep. Kate Segal (D–Battle Creek), the House Democratic floor leader.

Even if the committee passed the health care exchange bill, the bill would not be implemented if two anti-abortion bills do not pass state law due to the tie bar, Segal said.

“Republicans refuse to acknowledge the Affordable Care Act is here to stay, and they’re putting politics in front of what’s best for Michigan,” Segal said. “They further tied politics to it by trying to make it an anti-abortion bill that has no consideration for the life and the safety of the mother.”

Some state Republicans met the committee’s decision on Wednesday with disappointment over the loss of an opportunity to fully control an institution imposed on them by the federal government.

“It was my hope the committee would find that a state-run exchange afforded us more control over the unacceptable over-reach by the federal government regarding the health care of Michigan citizens,” state Speaker of the House Jase Bolger (R–Marshall) said in a statement.

He added: “After due diligence, however, it is clear that there were too many unanswered questions for the committee to feel comfortable with a state-run exchange.”

Michigan Attorney General Bill Schuette said in a statement on Wednesday that he was worried about the federal-state partnership, calling the exchange “an extremely complex issue” in which “many unanswered questions still remain.”

“I have always had grave concerns about establishing a health care exchange,” Schuette said in the statement.

The bill rejected by the committee passed in the state Senate on Nov. 10. At the meeting of the committee in Lansing on Wednesday morning, it drew praise and criticism from the public over the course of an hour-long open session.

One opponent of the exchange, Isabelle Terry, a resident of Rockford, Mich., wrote to the committee to opine that the Affordable Care Act “put us on an horrifying track to financial ruin.”

Matthew Davis, an associate professor of internal medicine at the University’s Medical School, said Medicaid is an example of a successful federal-state partnership, and indicates a similar partnership on health care could be effective.

Davis said a federal-state partnership could help University students find their own health insurance, a particularly beneficial criterion for students now as their parents’ employers are less likely to offer health care benefits.

He expected Snyder and the federal government to work out the details of the exchanges over the next few months and the deadline to implement them is October 2013.

Weiss said Snyder was committed to the partnership exchanges as the best possible option for the state.

“I certainly think it’s fair to say that Governor Snyder believes that the partnership approach can work,” he said.