Senate OKs state-based insurance exchange

BOISE, Idaho (AP) The Idaho Senate approved a proposed state-based health insurance exchange on Thursday after a debate in which it was alternately bashed as federal tyranny and praised as protecting Idaho's sovereignty.

Unlike two dozen Republican governors in other states, Gov. C.L. "Butch" Otter backs such an exchange run by a state-created, nonprofit corporation. He argues it will be cheaper and more responsive to Idaho residents and better for insurers based in Idaho.

The bill now goes to Otter, who sponsored the measure and said he'll sign it into law.

Sen. John Tippets, R-Montpelier, contended that adopting a state-run online marketplace for individuals and small businesses to buy insurance, rather than accepting a federal one, better protects Idaho from a single-payer system he fears is the ultimate goal of President Barack Obama's health insurance overhaul.

What's more, he said, the bill approved by a 23-12 vote includes provisions for Idaho to exit if courts eventually overturn the 2010 law. Many Idaho Republicans continue to hope that will happen, despite a June 2012 decision by the U.S. Supreme Court upholding its constitutionality.

"If that happens, we don't even have to take any actions to get out of this mess it's already done right here," Tippets said. "I wish we could keep the Affordable Care Act from being enacted. I don't see any way."

The final vote was unchanged from the Senate's Feb. 21 tally on a similar bill.

Since then, the House has added requirements, including competitive-bidding for contractors seeking to run the exchange; gun-rights protections for participants; and an expanded, 19-member board that includes three legislators two from the majority party and one from the minority with voting rights.

Its meetings would have to be streamed over the Internet, for the public to see. The revised bill was returned to the Senate, which had to consent to the changes.

On Thursday, foes of the exchange acknowledged they were unlikely to alter last month's vote but still spent about three hours trying.

Sen. Russ Fulcher, R-Meridian, predicted adopting a state exchange would attach Idaho to the strings of "the federal puppeteer." Such a relationship would eventually have to be undone after people realize it's too expensive and begins to collapse under its own administrative weight.

"My heart, my mind and my soul believes that this is the wrong thing for Idaho," Fulcher said.

Otter, a Republican critic of the federal government, says a state exchange will involve fees for 177,000 expected participants that are estimated at a third of the federal cost.

Opponents, however, counter that the state has no idea what the plan would cost.

Sen. Bob Nonini, R-Coeur d'Alene and an insurance broker, said the governor's talk of protecting Idaho-based insurers such as Blue Cross of Idaho and Regence Blue Shield is misplaced. Lobbyists for both companies worked for the establishment of a state exchange.

Nonini said the companies are all flourishing, having accrued hundreds of millions of dollars in reserves while increasing the cost of premiums.

"We hear in debate that we're going to protect Idaho businesses by doing a state exchange," Nonini said. "These companies, whether they are insurers or those providing medical care, are doing quite well on their own."

Sen. Dean Cameron, R-Rupert, said the question isn't about the merits of Obama's Patient Protection and Affordable Care Act but rather what is the best way to adopt a key provision of the federal law over which Idaho has no control.

"This is a step forward it's not just words on a paper to protect Idaho citizens, Idaho consumers, Idaho jobs, to protect our rights as Idaho citizens so we don't acquiesce to the federal government," Cameron said.