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Utah governor says no, for now, to federal health exchange

Published November 20, 2012 8:34 am

Health reform • Too many questions remain unanswered to commit, says Herbert.
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Utah is no longer among the dozen hold-out states undecided about whether to run their own federal health insurance exchange marketplaces.

Instead of bringing Utah's exchange, Avenue H, up to new federal standards, Republican Gov. Gary Herbert announced Monday that he wants to keep it as is.

"This decision could change as we receive more information and answers to critical questions," he wrote Monday to U.S. Health and Human Services Secretary Kathleen Sebelius.

But for now, Herbert is staying the course and continuing to pursue Utah's homegrown reforms, including, he said, "our version of an exchange based on defined contribution [of money by employers], consumer choice and free markets."

The letter comes a week after state legislative leaders declared that if the feds want a federal exchange in Utah, they should run it themselves. Absent a change of heart by Herbert, that's exactly what will happen.

The Obama administration has given states another month to declare their plans for implementing this key provision of the Affordable Care Act, moving the deadline from Nov. 16 to Dec. 14.

Herbert told Sebelius he appreciates the extra time, but what he needs is regulatory guidance.

Funding tops a two-page list of concerns accompanying his letter to Sebelius. Will users of the online portal pay a fee? If that falls short of what's needed to keep exchanges running, will the feds pick up the rest of the tab? Herbert asked.

One incentive for states to run their own exchanges is it will give them greater regulatory control over their health insurance markets.

How would a federally run exchange work with Utah brokers and insurance laws? Herbert wants to know. Who, for example, would set the threshold for what benefits each policy, at minimum, contains?

Precisely how Herbert intends to improve on Avenue H isn't clear from the letter; he did not respond to calls for comment.

Avenue H is now open only to small-business owners and employees, not individuals. About 7,000 Utahns get their insurance through the shopping portal using set contributions from their employers — a tiny number, considering Utah's ranks of 330,000 uninsured. —

What is the federal health exchange?

Consumers and small businesses would be able to buy coverage through state exchanges with government help to pay premiums.