New grants are available for states to establish health insurance exchanges — a fundamental part of the Affordable Care Act the House voted on Wednesday to repeal — U.S. Department of Health and Human Services Secretary Kathleen Sebelius announced Thursday.
Her announcement came on the same day House Republicans introduced several bills aimed at revamping sections of the health care law, since the House bill on repeal is expected to die in the Senate.
“The tree is rotten, so you have to cut it down,” said Ways and Means Chairman Dave Camp, R-Mich. “If we can’t do that all at once, prune it branch by branch.”
House leaders have instructed four committees to develop a Republican health care plan, with no deadline set. A group of Republicans also proposed a budget plan prohibiting spending on health care reform this year.
Sebelius called Wednesday’s House vote “unfortunate” and said her department is moving ahead with an unspecified amount of funding authorized in the federal health care law for all states to set up an exchange.
California has saved the $1 million federal grant it got in September to plan its Health Benefit Exchange and will use that first and then apply for more funding, said Secretary Diana Dooley, the newly-appointed head of the state Health and Human Services Agency.
California is facing a $25 billion budget shortfall, which Dooley noted.
“We are facing a serious budget crisis that we are addressing with an honest, straightforward plan that has just been proposed in the California Legislature,” Dooley said during a conference call she and Sebelius held with reporters Thursday. “Fixing our broken health care system is part of that recovery.”
The exchanges, which are to start operating in 2014 and be self-supporting, provide a place for small businesses and people without job-based health plans to join together to buy policies at lower rates than they would be able to do individually. Low- and middle-income consumers would get federal subsidies to help cover premium costs.
Sebelius said 48 states and the District of Columbia — including California’s $1 million grant — have applied for and received exchange planning grants from the $49 million authorized last year.
The new grants will be for establishing exchanges, with the amounts dependent on each state’s application.
California Gov. Arnold Schwarzenneger signed legislation last fall establishing the framework for the California exchange, which officially became operational Jan. 1. Three of the five board members who will oversee the exchange have been appointed, including Dooley.
Dooley said the initial $1 million grant will be used to design the exchange system and put together a budget request for the next grant.
California is the first state to establish its exchange, and Dooley said “we will make California a leader” in the system.
The Affordable Care Act would expand coverage to more than 30 million uninsured people, bar insurers from denying coverage to people with pre-existing medical problems, and require most Americans to buy insurance.
House leaders have instructed four committees to develop a Republican health care plan, with no deadline set.
The Associated Press contributed to this story.
Website: www.signonsandiego.com/news/2011/jan/20/sebelius-announces-new-grants-health-insurance-exc/