Gov. Susana Martinez signed into law today legislation that will create a state health exchange for New Mexico.
A cornerstone of the 2010 federal health care law, exchanges, also known as marketplaces, are meant to help reduce the number of Americans who go without health insurance. In New Mexico, by some estimates, 200,000 of the state’s more than 400,000 uninsured residents eventually could participate in New Mexico’s exchange, which is supposed to begin to enroll eligible New Mexicans beginning in October.
Senate Bill 221, sponsored by Benny Shendo, D-Jemez Pueblo, emerged after weeks of negotiations and back-room dealmaking during the 60-day legislative session that ended earlier this month. At times the negotiations faltered, leaving some state lawmakers to wonder if New Mexico might miss the chance to tailor an exchange to the needs of a state that has many challenges.
Those states judged as having not made enough progress in setting up their own state-based exchanges by late spring could confront the possibility of the federal government setting up the marketplace.
Faced with a looming deadline, state lawmakers compromised on Senate Bill 221, a deal that even some supporters acknowledged was forged out of fear of a larger federal role in setting up the exchange. Meanwhile, critics of the bill said it failed to protect consumers enough and allowed health insurers too much influence in how the marketplace will run.
If all goes according to plan, New Mexicans eligible to use the exchange can begin enrolling by October and the health insurance policies they purchase will go into effect Jan. 1, 2014. Federal subsidies should help many New Mexicans using the exchange to purchase health insurance.
Section 3 Paragraph G (1) allows members of the boards of directors of insurance companies to sit on the board of directors of the exchange. Paragraph L sets up a two-year revolving door for representatives of health insurance companies, while health care providers have three-year terms.
The exchange has no means for rate controls other than those already existing in state regulations and law. Nothing about the exchange provides more competition between insurers than what already exists in the wider market. Nothing is inherent in the exchange that will begin not merely to reduce the rate of growth of our health care expenses but to actually start reducing them to parity with other first-world countries.
I see no benefit to this exchange other than that it provides additional income from the taxpayers to insurance and health care providers who will have part-time jobs on the board and a few jobs for new employees of the exchange. The law does nothing to reform our health care finance system. It merely creates another market for insurers.
And corruption is built-in to the system.
Wouldn’t it be more correct that the “backroom deals” tailored the bill for the insurance companies rather than for the needs of the citizens? It would have been better to not pass a bill and let the federal government run it. It would have saved state administrative expenses and reduced insurance customers’ costs.