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Defunding State Health Insurance Exchanges Would Slow Health Reform

April 24, 2012 at 4:13 PM

The House voted almost a year ago to undercut the Affordable Care Act by repealing its grants to help states set up "exchanges," the new marketplaces that will allow individuals and small businesses to choose among a number of private health insurance plans. (The measure didn't go anywhere in the Senate.)

Here we go again.

The House Energy and Commerce Committee is preparing to vote this week on a similar provision, part of a bill to cut mandatory spending as the House-passed budget plan requires. (We blogged about another provision of that bill earlier today.)

The Congressional Budget Office (CBO) predicted last year that repealing the exchange grants would delay state efforts to set up the exchanges, which are scheduled to be up and running on January 1, 2014. As a result, CBO estimated, 2 million fewer people would participate in the exchanges in 2015, which means fewer low- and moderate-income people would receive federal help with premiums, deductibles, and other cost-sharing charges to make coverage more affordable.

A number of states are moving forward to set up exchanges and are using the exchange grants to support their efforts; 34 states have received establishment grants as of April 16. Congress shouldn't undermine this important part of health reform.

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