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Balking GOP legislators want to be ‘partners’ in shaping state’s health exchange

They won’t even accept $4.2 million in federal funds without putting up a squawk but argue there’s more at stake than their dislike for federal health care reforms.

Minnesota Republican legislators won’t even accept $4.2 million from the federal government without putting up a squawk.

The funds arrived to help the state create the infrastructure that would be needed to create a health insurance exchange. This exchange, which is to be functioning by 2014, would become a one-stop shopping place for people or businesses — especially small businesses — seeking private health insurance as federal health care reforms unfold.

The idea of an exchange receives applause from the business community, which usually has the ear of the GOP.

So are Republicans protesting what many of their own supporters endorse simply because it’s included in “Obamacare”? In the name of politics, is the GOP going to reject anything that comes from the Obama administration, even if it means saying “no” to policies that the party typically would embrace?

Rep. Steve Gottwalt, R-St. Cloud, is among those protesting the Dayton administration’s acceptance of the federal money. There are some members of his party, he admits, who would reject any idea that might be associated with the president.

Rep. Gottwalt worries about new ‘bureacuracy’
But, he said, his concern is that legislative leaders weren’t consulted about moving forward with a plan that he believes could dramatically change health care in the state. He’s also believes that a government-run exchange will only create another bureaucracy that “will hurt a robust, private market.”

Rep. Steve Gottwalt
Rep. Steve Gottwalt

Gottwalt and Sens. David Hann and Chris Gerlach were among Republican leaders talking tough about holding hearings on the health care exchange, perhaps even going to court to block it.

“We [legislators] need to be partners in what this will look like,” said Gottwalt, who is chairman of the House Health and Human Services Reform Committee. “We can’t let this simply happen behind closed doors.”

Hann, chairman of the Senate Health and Human Services Committee, says this reflects the fundamental differences between Republicans, who believe in the sanctity and efficiency of the private market, and those who believe that government does a better job.

In his world view, “red flags” fly over this exchange plan.

“I’ve talked to people in the [health insurance] industry,” Hann said. “They don’t see this as necessary. That raises red flags to me.”

Commerce commissioner surprised by objections
Mike Rothman, the Dayton administration’s commissioner of Commerce, says he is surprised by the Republican complaints.

The idea of Minnesota setting up its own exchange not only is applauded by the business community but also will help the state maintain control of its own destiny regarding health care. That, too, usually is a Republican goal.

Hann, though, believes business really isn’t all that excited about any sort of government exchange program.

Sen. David Hann
Sen. David Hann

“I think the chamber and some in the health care industry have been supportive out of fear that if something isn’t done, something worse will happen,” said Hann. “I think it’s the like the question: Would you rather be executed by the guillotine or by strangulation.’ I think they’re saying ‘strangulation’ because it might give us time to get out of it.”

The $4.2 million, coupled with $1 million the Legislature already had provided, is to be used to create the exchange structure. By government standards, the timeline is tight.

The plan must be in place by Jan. 1, 2013, and, assuming it’s approved by the feds, ready for public use by Jan. 1, 2014.

If the feds don’t approve of the Minnesota plan, the state would be lumped into a federal exchange.

Republicans and Rothman seem to agree that’s not the desirable way to go.

Differing views on state’s leadership role
“Minnesota already has a unique, nonprofit system,” Rothman said. “We’re ahead of the nation, and we want to stay that way.”

Gottwalt echoes Rothman in singing praises to Minnesota’s leadership role in health care.

“We ought to preserve our leadership,” he said, but in his view that means more private, less government.

The exchange is only a small portion of the federal health care reform package. In theory, it’s designed to inform consumers and create cost controls by creating competition through direct comparisons of health insurance options.

“It’s a Travelocity or Expedia for the health care market,” Rothman says.

This exchange site would be available to all — a place to turn to compare costs and benefits of health insurance plans. The exchange will include all types of insurance programs for all sorts of users, including individuals, those who can’t afford private plans, and programs for small and large businesses.

Gottwalt argues that the private sector already offers such websites. He said he’s got a constituent in his St. Cloud district eager to sell the state a system that he’s already devised.

Among the dangers Gottwalt sees in a state exchange is that “the government will end up dictating everything. It will dictate benefits, costs. You’re now putting government pretty much in charge.”

Rothman, however, says that a state-controlled exchange does exactly the opposite. It puts Minnesotans, through the legislative process, in charge of what the fundamentals of responsible health care coverage includes.

If Minnesota ends up in the federal system, the fundamentals of what should be contained in a health insurance program suddenly would be controlled by the feds. Assuming that Minnesota currently has more coverage requirements than many states, it’s reasonable to assume that if the state ended up lumped into the federal system, a Minnesota health insurance policy might have fewer benefits in the future.

There are Republican politicians at both the state and federal level who believe the Supreme Court will reject all — or most — of the federal government’s health care requirements.

Gottwalt believes the court will reject a crucial portion of the federal reforms, the mandate that requires individuals to purchase health insurance, but likely will allow the exchange portion of reforms to go forward.

Health exchange key part of reforms
Of course, if the federal reforms, including mandates to purchase, do pass muster with the Supremes, an exchange system would play an important role in leading individuals to insurance plans.

But Rothman emphasizes that mandates are “a separate issues, completely out of state plans.”

So back to that basic question: Are Republican legislators complaining only because they’re so accustomed to saying “no” that they can’t say “yes”?

“My hope is that politics is not the issue,” said Rothman, without laughing.

The administration will go forward, quickly, he said. A task force, made up of various “stakeholders” will be formed to help create the plan for a Minnesota exchange.

The stakeholders include the commissioners of the departments of Health and Human Services, leaders of the health insurance industry, health care providers — and legislators.

“In preparing for an exchange, we will actively seek constructive public input from all parties,” Rothman said Wednesday in a statement. “We need all hands on deck — consumers, employers, legislators, insurers, agents, navigators, and health care providers — to help design an exchange that supports Minnesota’s unique health care system and demonstrates again why Minnesota leads the nation in health care innovation.”

Hann says that if the exchange idea was so good, the Dayton administration would have brought it forward in the form of proposal for the Legislature to vote up or down.

“We [the legislators] represent people from every corner of the state,” he said. “By them [the administration] not coming to the legislature, it leads me to believe they’re not too interested in what we have to say.”

Gottwalt also says a “consultative role” is not enough for the Republican majority.

“We want a partnership,” he said.

That partnership concept didn’t seem to work so well during the legislative session.

Doug Grow writes about public affairs, state politics and other topics. He can be reached at dgrow [at] minnpost [dot] com.