Quinn mulls using executive order to create insurance exchange

May 16, 2012

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(AP) ? Illinois Gov. Pat Quinn may use an executive order to establish a health insurance exchange, a website where consumers could comparison-shop for insurance that’s a key piece of President Barack Obama’s health care law, according to Quinn’s chief health care adviser.

Michael Gelder, the governor’s adviser, said the General Assembly?s workload on Medicaid and pension reform makes it unlikely lawmakers will be able to pass legislation authorizing an insurance exchange during the current session, which is scheduled to end later this month.

Amid uncertainly created by the constitutional challenge to Obama?s law, Democratic and Republican leaders in Springfield have agreed to shelve a bill that would create an exchange.

Related story: General Assembly puts health exchange bill on back burner

Looming federal deadlines leave the governor with two choices: calling the Legislature back into special session or issuing an executive order, Gelder said.

But Republicans said an executive order would be inappropriate, especially before the U.S. Supreme Court rules on the Affordable Care Act. A decision is expected in June.

“The issuance of an executive order to establish a health insurance exchange by Gov. Quinn at this time is premature on a number of levels,” said Sen. Bill Brady, a Bloomington Republican who co-chaired a legislative study committee on the health insurance exchange. “We expect the U.S. Supreme Court to issue a ruling on Obamacare in just a few weeks.”

An executive order would undercut the legislative process and cut out stakeholders who’ve been involved so far, Brady said.

“There is no consensus, but the governor should let that process play out,” he said.

An executive order is needed, Gelder said, to secure federal grants and meet a deadline to prevent the federal government from running an insurance exchange in Illinois. States have a Jan. 1, 2013, deadline for Washington to approve their plans or risk the federal government coming in to run things.

Only two states have established insurance exchanges by executive order: New York and Rhode Island. Another 10 states and the District of Columbia have passed laws establishing exchanges since Obama signed the law. Massachusetts also has a state-run health insurance exchange.

Last fall, an Illinois legislative study committee failed to form a bipartisan consensus about how the exchange would be governed. An executive order could address that.

Brian Imus of the nonpartisan Illinois Public Interest Research Group said Quinn should use Rhode Island’s executive order as a model rather than New York’s because it includes more consumer protections and rules against conflicts of interest. Rhode Island Gov. Lincoln Chafee’s executive order sets up a governing board free of insurance industry members, for example.

“Rhode Island is just much more proscriptive and makes clear that the governing board has representatives of consumers and small businesses,” Imus said.

An executive order could create a governing structure, but legislation still would be required to set up ways to pay for the exchange.

The state-based health insurance exchanges are meant to create more competition and reduce administrative costs as they offer one-stop shopping for health coverage. They are a linchpin to expanding coverage under Obama’s health law.

Illinois officials estimate nearly 800,000 uninsured residents will get public or private health insurance through the exchange in 2014, climbing to more than 1 million by 2020.

Most people buying insurance through the exchanges will likely be eligible for taxpayer-financed subsidies, and the exchanges will help people who qualify enroll in Medicaid. Participating insurance plans would have to take all applicants, regardless of prior health problems.

The Illinois exchange could even include a calculator that could determine a consumer’s insurance cost after their tax credit.

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