November 16. 2012 11:00AM - Last modified: November 16. 2012 11:44AM

Walker defers health exchange formation to federal government

  
As expected, Wisconsin Gov. Scott Walker announced today that he will not attempt to create a state health care insurance exchange for Wisconsin residents and will instead defer that chore to the federal government.

To comply with the Affordable Care Act, otherwise known as Obamacare, the governors of the states must inform the Obama administration today whether or not they will pursue federal funding to help them establish the exchanges. If they do not wish to form their own exchanges, the federal government will create the exchanges for them.
Walker formally declared his decision today in a letter to U.S. Health and Human Services Secretary Kathleen Sebelius.
“In Wisconsin, we have been successful in providing health insurance coverage to over 90 percent of state residents without the creation of an exchange and absent federal regulation. We have a long history of being a leader on health reform issues, and with more guidance and greater state flexibility, our competitive market system would have ensured health insurance coverage to the most vulnerable Wisconsinites without federalization of our market. Unfortunately, operating a state exchange would not provide the flexibility to meet our state’s unique needs or to protect our state’s taxpayers,” Walker wrote. “Therefore, after much consideration and outreach with citizens across the state, and in the best interest of the taxpayers of Wisconsin, we have determined Wisconsin will not develop a partnership or state-based exchange.”
The decision pitted Walker between siding with corporate interests or Tea Party interests on the far right of the political spectrum.
Several groups, including the Wisconsin Manufacturers & Commerce; the Wisconsin Chapter of the National Federation of Independent Business, the Wisconsin Association of Health Plans, the Wisconsin Hospitals Association and the Wisconsin Medical Society, had urged Walker to form a state-run exchange, rather than leaving it all up to the federal government.
Wisconsin Hospitals Association executive vice president Eric Borgerding said today, “"For us, decisions about Wisconsin's health care system should, to the greatest extent possible, be made in Wisconsin. We are blessed with tremendous health care leaders, innovators and policymakers in Wisconsin and have never believed a one-size-fits-all federal government approach to an exchange can do a better job than we can in Wisconsin. We are hopeful that this is not the final chapter, that obstacles preventing Wisconsin from choosing to run its own exchange can still be addressed down the road."
Kurt Bauer, president and chief executive officer of the WMC, said today, “While WMC supported the creation of a Wisconsin-specific exchange, we acknowledge that Governor Walker makes a good case for not doing so. As the state’s largest business association, our mandate is to help our members navigate through the burdensome requirements of the Affordable Care Act (ACA). WMC will continue to work with the Governor and all other state and federal stakeholders to provide as detailed and timely information about the ACA to Wisconsin’s business community as possible.”
Phil Dougherty, senior executive officer of the Wisconsin Association of Health Plans, said, “Now that Governor Walker has made his decision, we will move forward.  We will work with Wisconsin stakeholders to encourage adoption of Exchange standards that suit Wisconsin. Wherever possible, we will seek to build on what works in our state—such as regional participation of Wisconsin-based health plans—and keep regulatory control and decision making in Wisconsin. Regardless of the type of Exchange to be implemented in the state, we will work collaboratively toward an approach that continues to offer Wisconsin consumers and employers high-quality health care through a competitive insurance market.”
Representatives from 20 Tea Party groups in Wisconsin sent a letter to Walker, warning him against pursuing a state-run exchange.
"Wisconsin must stand. As a significant and highly active portion of your base, we have defended you tirelessly through all of the battles of the last year and a half. We also came to the aid of legislators who stood with you on Act 10. We have done right by you. We now urge you to once again do right by us," stated the letter, which was signed by Tea Party advocates from around the state, including Joanne Terry of "Ozaukee Patriots" in Mequon, Paul Bruno of "Tea Party Perspective" of Racine and Ed Willing of "Founders Intent" of Caledonia. "The sovereignty of this state and the personal liberty of every single Wisconsinite is at stake – including the lives of the unborn, on whose behalf you have, to date, always advocated. No other considerations can compare to life and liberty. As noted, a yes to Obamacare is not an option. We will not accept it. We are therefore waiting for you to issue an unequivocal, 'NO!' When you do, we expect all Republican state legislators to stand with you, as will we."
Walker’s decision drew criticism from supporters of Obamacare.
Democratic Senate Leader Chris Larson (D–Milwaukee) said, “Half a million Wisconsinites are currently without health insurance. With the federal health care reform law being ruled constitutional by the U.S. Supreme Court and elections concluding, it’s time to work together on ensuring all Wisconsinites have access to quality, affordable health care coverage. We are disappointed that the governor has opted to punt this problem to someone else to solve as this is not the Wisconsin way. Wisconsin is unique with its own health care needs and we urge the governor to reconsider passing up this opportunity to create an individualized implementation plan for our state.”
Robert Kraig, executive director of Citizen Action of Wisconsin, a liberal activist group, said, "It is astounding that Walker is putting the demands of ideological extremists over the interests of health care consumers across Wisconsin who need access to quality affordable health care options. Guaranteeing that health care consumers can have a choice of competing health plans, and establishing rules of the road to make sure consumers are not ripped off or denied coverage based on pre-existing conditions should not be controversial. The extreme tea party response to common sense  reform is a real barrier to governing in the public interest. Given Walker’s strong opposition to the goals of health care reform, it is likely much better that the federal government operate Wisconsin’s health insurance exchange. Given Wisconsin’s well-earned tradition of effective and innovative government, it is a shame that we have a governor who does not want to take responsibility guaranteeing that everyone has some where to go to buy quality affordable health care."
“Gov. Walker decided that his chances for higher office in the tea party-controlled Republican Party are more important than doing his job,” said Scot Ross, One Wisconsin Now executive director. “Wisconsin knows that Gov. Walker wants big insurance companies to be allowed to deny people with pre-existing conditions access to care because big insurance owns Scott Walker.”

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