Gov. Walker says Wisconsin won't run own health insurance exchange

Decision made despite stakeholder protests

Published On: Nov 16 2012 07:10:00 PM CST   Updated On: Nov 19 2012 09:17:51 AM CST
Health Insurance 2
MADISON, Wis. -

Gov. Scott Walker said the state will not run its own health insurance exchange despite requests from many state stakeholders to do so.

The governor is adamant that the state is complying with the law and that there will be health insurance exchanges as required under the federal health care law.

He just believes the state shouldn't do it itself.

Speaking to reporters on a conference call from the Republican Governor's Association meetings, Walker said his decision on a state-run health insurance exchange had to do with taxpayers.

"If we take on the challenge of running the exchanges, it commits us to long-term spending obligations and costs that are uncontrolled and not fully-funded," said Walker. "Eventually, if the federal funding dries up, costs for Wisconsin taxpayers could skyrocket under a state-run exchange."

The Walker administration said it estimates the annual cost of the exchanges could be $45 to $60 million that wouldn't necessarily be covered by the feds.

"While we appreciated people wanting to have something uniquely Wisconsin, the reality is the law fundamentally doesn't allow us to do that," said Walker.

"By punting and putting it over at the federal level, we're kind of handing our health care decisions over to the federal government, and that's a concept that small business did not support," said Bill Smith, Wisconsin director for the National Federation of Independent Businesses.

The Wisconsin arm of the NFIB supported the state option as did other major stakeholders including health insurers, manufacturers, hospitals and health care advocates, all of whom were hoping for more input.

"I think it's myopic and short-sighted by the governor," said Bobby Peterson, executive director for ABC for Health. "A lot of these expenses we're paying already, paying in the form of higher health care costs."

"I think by favoring a state-run exchange, they would have a voice at the table," said Smith. "When we turn our health care over to the federal government that voice will probably be a smaller voice."

Walker says those groups weren't able to convince him of any advantages to having the state take on the responsibility.

"The reality is we get a shrug every time in these meetings when it is brought up because the reality is, there isn't [an advantage]," said Walker.

While those stakeholder groups are disappointed the state is not running the exchanges, the NFIB and others have said they understand and respect the governor's reasoning.

The state's next decision will be on an optional Medicaid expansion, but there's disagreement on the costs and benefits of that, as well.