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Gov.: Kan. will have federally run health exchange

Published on -11/9/2012, 8:32 AM

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By JOHN MILBURN

Associated Press

TOPEKA -- Gov. Sam Brownback said Thursday that Kansas will have a federally run health insurance exchange, after he declined to support the state insurance commissioner's application for a state-federal partnership.

Brownback had said months ago he would wait until after Tuesday's election before moving forward on any provisions of the new federal health care law. He announced his decision about the required exchange -- an online health insurance marketplace -- after meeting with Insurance Commissioner Sandy Praeger, who sought the governor's signature on a letter of support for a state-federal exchange.

The decision illustrates the divide over the federal health care law between the conservative Republican governor and the moderate Republican commissioner.

"My administration will not partner with the federal government to create a state-federal partnership insurance exchange because we will not benefit from it and implementing it could costs Kansas taxpayers millions of dollars," Brownback said in a statement.

He invited any elected official who supported the law, the centerpiece of President Barack Obama's first term, to seek legislation during the 2013 legislative session where the issue can have a debate and vote.

But states have only a week, until Nov. 16, to inform the federal government if they plan to create their own health insurance exchanges, partner with the federal government or have their exchanges run by federal agencies. The exchanges are to be designed as a marketplace for consumers to review and compare health insurance plans -- private or public -- that meet minimum federal requirements.

Praeger, an elected commissioner, had been working on a grant application to seek a state-federal partnership to manage the exchange in Kansas. Brownback had to sign a letter of support before the application could be filed with federal officials.

"Our job at the insurance department was to be prepared with exchange information, and we were. The governor has made his decision," Praeger said in a statement, referring all other questions to the governor's office.

Kansas Democratic Party Chairwoman Joan Wagnon called Brownback's decision not to partner with the federal government on the exchange "an abdication of his responsibility."

Praeger's staff prepared an application that would have Kansas fill the roles of plan management and consumer assistance. If approved, Kansas would have received federal funds to spend on building the partnership exchange, but they only could have been spent if approved by the 2013 Kansas Legislature.

Kansas has rejected federal money for the exchanges before. Pressure from the conservative Republicans last year prompted Brownback to reject $31.5 million in federal funds to help build the computer infrastructure necessary for an exchange.

The federal health care law was a factor in Tuesday's legislative election results, following the trend set in 2010 when Brownback was elected and large numbers of conservative Republicans were elected to the Legislature. Nearly all ran on the platform of opposing the health care law over concerns that it was an unconstitutional intrusion on state and individual rights.

Those victories were followed by more wins by conservatives in the August primary and on Tuesday, which marked defeats of moderate Senate Republican incumbents who opposed a measure to amend the Kansas Constitution granting so-called health care freedom choices to residents.

Derek Sontag, state director for Americans for Prosperity, a limited government, anti-tax organization, said legislators should take the same position as Brownback and reject any notion of an exchange. Sontag's wife is the governor's communication director.

"Establishment of a government exchange would increase taxes on businesses and raise insurance prices on hardworking Kansans," said Sontag. "President Obama wants states to believe they have flexibility to control their exchange when in reality, the federal government has to approve of significant changes sought by the state."

Senate Minority Leader Anthony Hensley, a Topeka Democrat, said Brownback's administration appeared to repeatedly "bury its head in the sand" regarding implementing any portion of the Affordable Care Act.

"He's made a lot of decisions, and we just will have to see if these decisions are the right decisions. I think time will tell," Hensley said.

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