House GOP expected to defund state health insurance exchanges
WASHINGTON (Reuters) – Republicans in the U.S. Congress are launching a fresh attack on the healthcare law by targeting grants to states for creating insurance exchanges, just as congressional budget analysts said on Thursday setting up the marketplaces may be delayed.
Next week, the U.S. House of Representatives is expected to take up a bill that would repeal funding for $1.9 billion in grants for establishing exchanges where individuals can purchase health insurance.
While the measure is expected to pass the Republican-controlled House, this latest attack against President Barack Obama’s healthcare overhaul will likely go nowhere in the Democratic-led Senate.
The exchange idea is a key component of Obama’s healthcare law, which has faced numerous challenges in Congress and the courts since it was passed a year ago.
Exchanges must be operational by January 2014 and self-supporting by January 2015.
But the Congressional Budget Office said in a new analysis the exchanges are not expected to reach full enrollment until 2016.
“That expectation reflects the likelihood that some states will encounter delays in achieving fully operational exchanges in the first few years,” CBO said. “In addition, participation rates among potential enrollees are expected to be lower in the first few years as employers and individuals adjust to the features.”
More than half the states, along with business groups and individuals, have sued, saying the law’s requirement that people buy insurance is unconstitutional and that the law usurps states’ sovereignty.
The Republican-controlled House voted to repeal the law this year. But with Senate Democrats standing in the way of full repeal, House Republicans are now working on bills to try to undo the law bit by bit.
Two weeks ago, the House passed a bill that would yank money for a prevention and public health fund. A bill repealing grants for operating school-based health centers also could come to the House floor as early as next week.
The CBO, which estimates the costs of legislation, said blocking state grants for exchanges would reduce the U.S. deficit by about $14 billion from 2012 through 2021.
Rescinding the funds, though, would not eliminate the exchanges. Instead, it would shift much of the responsibility for creating the marketplaces to the federal government, which could in turn push up U.S. costs, CBO said, although it did not estimate the size of those obligations.
States can create exchanges alone, band with neighboring states, or opt out entirely and have the federal government establish exchanges within their borders.
(Reporting by Lisa Lambert and Donna Smith; Editing by James Dalgleish)