Analysis: Chaney had an exchange backup all along

By Shelia Byrd/The Associate Press

JACKSON, Miss. (AP) — Mississippi Insurance Commissioner Mike Chaney is a former lawmaker and knows issues can get lost in the shuffle at the Capitol.

So, when legislators failed to pass a bill to create a health care exchange during the 2011 session, Chaney had a backup plan.

As commissioner, he said he has the authority to choose an entity to operate the federally mandated health exchange, which is part of the Obama administration’s health care law and will serve as a one-stop shop for insurance consumers.

Chaney selected the Comprehensive Health Insurance Risk Pool Association, a nonprofit that provides coverage to those who are not eligible for private insurance because of health conditions.

After the association met on Friday, Chaney said “it looks like they’re going to do it.”

The exchange is designed to help consumers choose a health care plan appropriate for their needs, while creating more competition among insurance companies to drive down prices.

It also is supposed to help determine whether someone is eligible for Medicaid or the Children’s Health Insurance Program, which are both funded by the government.

The idea of an exchange has had bipartisan support in the Mississippi Legislature, but there didn’t appear to be a sense of urgency to get a plan approved this session because the U.S. Department of Health and Human Services didn’t require the exchange to be in place until Jan. 1, 2013.

Lawmakers had planned to get it done in 2012. But Chaney didn’t want to chance it. If the state doesn’t act on its own, the federal government will intervene.

“I don’t want the federal government operating an exchange. The state would have no say so as to the regulation of the companies sold on the exchange. There would be other criteria requiring the allocation of state funds without legislative approval. In other words, having unfunded mandates,” Chaney said.

It’s unclear just how talks on the exchange fell apart during the legislative session. Lawmakers give different explanations.

One of the main sticking points was the Senate’s plan to make the exchange a nonprofit entity. The House wanted to make the exchange part of a government agency to give it oversight.

“We put in oversight by the state Department of Audit, PEER and called for reports to be filed. We thought we covered all their oversight issues. In the end, the whole thing got caught up in politics,” said Senate Insurance Committee Chairman Eugene “Buck” Clarke, R-Hollandale.

Rep. Robert Johnson, D-Natchez, who was the principal author of the House plan, said during final compromise talks that it was hard to get all three of the Senate negotiators to meet with the House.

“I think both houses were preoccupied with the budget and redistricting,” Johnson said. “Everybody kept saying we don’t have to do it right now. It was urgent to me.”

House Insurance Committee Chairman Walter Robinson, D-Bolton, said too many questions needed to be answered about how the money would be spent.

The federal government will provide Mississippi with funding to start operating the exchange, which must be self-sufficient by 2015, Chaney said. Insurance companies would be assessed fees to participate in it.

“It’s no telling how much money we’re talking about. How much will you pay the executive director (of the exchange)? Where is the office going to be?” Robinson said. “The legislators just wanted oversight,” Robinson said.”

Chaney said the exchange would be based on the model in the Senate bill. He said that proposal came from his office. He said the risk pool’s board of directors could form a “subgroup” to act as a board for the exchange. He said the exchange would be operated through grant money and fees.

“It would be a private, market-driven insurance program delivering better benefits than what’s currently available to consumers in the state,” Chaney said.

What remains to be seen is whether lawmakers will accept Chaney’s plan or continue their push for legislative oversight during the 2012 session.

Copyright 2011 The Associated Press.

Click video to hear audio