Traverse City Record-Eagle

Other Views

August 15, 2012

Another View: Secrecy imperils success of exchanges

In yet one more paternalistic turn on the health care overhaul, the federal government wants to keep hidden what it is requiring the states to open up. And this secrecy can only hurt rather than help any success the administration was hoping for.

The Obama administration is getting ready to set up and operate health insurance markets in those states that are unwilling or unable to do so. These are very complicated — and potentially ripe for collusion depending on who gets the contracts.

When the law passed Congress two years ago, it was widely believed on that side of the Potomac that every state would set up its own marketplace called exchanges where people would be able to shop around for their insurance and receive subsidies to help with the costs.

However, there was resistance and now it is widely expected that the federal government will run these so-called exchanges in about half of the 50 states which must go live by October of next year.

If you expected uniformity of such an undertaking because the feds are developing it, you'd be wrong.

These federal exchanges will vary state to state since the Obama administration will not define a single uniform set of health benefits that must be provided. Much of this work will be done by contractors to provide assistance, operate call centers and, more importantly, help the government decide who gets the federal subsidies, expected to average about $6,000 per person.

And while the federal exchanges operate "essentially" the same as the state-based exchanges, don't look too hard to prove your case. States do their work in public; federal work gets done in secret.

The federal requirement for states is a pretty good example of how an exchange should be set up, regardless of how you feel about them. It must "consult with stakeholders," including consumers, small business, health care providers, insurers, agents and brokers.

Kathleen Sebelius, the secretary of health and human services, has been reported saying that "states have to meet a standard of transparency and accountability." A state exchange must have "a clearly defined governing board," and the board must hold regular public meetings.

Not so for the federal government, which has done little to disclose its plans ...

States meanwhile must develop a budget that includes expected revenue and expenditures that any good entrepreneur would have to provide for any bank funding. In this case the taxpayers are the loan operatives.

The feds? Not so much. It hasn't set up a budget for its exchanges and said only that it will charge "user fees" to those participating in the exchanges although it is unclear whether those fees must pass through Congress or if it will eventually be passed on to the consumers.

With much being done behind the scenes and the only response back from the administration is "trust me," a train wreck is surely waiting to happen.

The Free Press Mankato, Minn.

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