Arizona's policymakers clashed with members of the business community and insurance industry Nov. 2 over whether to implement a key component of the federal health care overhaul.
Under the federal law, states have the option to run their own health insurance exchange, which will ultimately be a web portal where individuals and businesses can buy insurance. If states choose not to implement the exchanges, the federal government will do it for them.
Although she opposes the idea, Gov. Jan Brewer has taken tentative steps to establish Arizona's health insurance exchange. Her office has made clear it would rather have the state run the web portal rather than defer to the feds.
But key legislators and some conservative advocacy groups fiercely resist the idea of going forward with any part of the system, arguing that establishing the exchange is aiding the implementation of what they have derisively dubbed "Obamacare."
The clash of opinions was at full display during a special committee hearing on the health exchange early Nov. 2, and the debates foreshadow what could be a showdown between the pragmatist in Brewer and a recalcitrant Legislature.
During the meeting, representatives from the business community and insurance industry told lawmakers Arizona should operate the exchange. They share no enthusiasm for the federal healthcare overhaul, but they said since it's the law of the land right now, Arizona will have an insurance exchange whether policymakers like it or not.
They said that if Arizona sets up the exchange, at least policymakers will have a say in how it functions; adding that some flexibility is afforded to states that establish their own health exchanges.
"The ultimate question to ask yourselves as Arizona legislators is this: Do you really think your constituents will be better off under a federal program controlled directly by the Obama administration or by a state-based exchange that will take every precaution to preserve choice and competition and keep costs as low as possible," said Steve Barclay, a lobbyist for Blue Cross Blue Shield of Arizona.
"The answer is clearly the latter," he said.
The harshest critics of the health exchange argued if Arizona sets up the exchange, it would also be aiding in implementing a law that it is currently being challenged in court.
Arizona is one of several states that have sued over the federal health care law's constitutionality.
Diane Cohen, a lawyer with the Goldwater Institute, said moving ahead with the exchange would adversely impact Arizona's case against the law.
"It is just plain incongruous to be at once challenging the constitutionality of Obamacare in the courts while at the same time enacting the provisions of it as a state," she said.
Cohen also called out Brewer for making tentative steps to set up the exchange.
But Don Hughes, the governor's health care policy adviser who is planning for the exchange, warned legislators that deferring to federal officials means they will decide the scope of the exchange, who will be allowed to sell insurance on it and how to fund its operation.
"We will not have any say in that, and our contention is it is better for Arizona to make decisions for Arizona," he said.
In order to meet the January 2014 deadline for implementing the health insurance marketplaces, states that wish to run their own exchange must have them ready for federal certification by January 2013. Federal health officials said states that haven't completely finished their work can get conditional certification for their exchanges if they can show that they're "making progress," and that states that have a federally run exchange can shift back to a state- run model after the 2014 deadline.