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State ready to run health exchange for small businesses, Herbert says

By Lisa Riley Roche | Posted - May 10th, 2013 @ 7:20am

SALT LAKE CITY — After months of negotiations, Gov. Gary Herbert sent a letter Thursday to Health and Human Services Secretary Kathleen Sebelius outlining how the state would run the newly mandated health insurance exchange for small businesses.

A response from Sebelius is expected Friday. Herbert has scheduled a 10 a.m. Friday conference call with the news media to discuss the agreement.

In February, the governor announced he had asked the federal government to handle the health insurance exchange for individual consumers but wanted the state to be allowed to continue to run a similar program for small businesses.

Since then, the state has been working on an agreement with the federal government to make Avenue H, Utah's existing health insurance exchange for small businesses, compliant with the Affordable Care Act, known as Obamacare.

An attachment to the letter states Utah will retain oversight of insurance markets and final approval of individuals enrolling in Medicaid, while the federal government will offer insurance for individuals and families and administer tax credits.

"Avenue H will operate as a state-based solution, with no interfaces to the federal government," the attachment states, noting employers will contribute a specific amount toward employee health insurance costs.


The state also will enter into an agreement with the federally run individual health insurance exchange to set standards for Medicaid services. Herbert has not yet made a decision on whether to accept the Medicaid expansion available under the act.

The governor included a separate letter from Utah House Speaker Becky Lockhart, R-Provo, raising concerns about sharing data between Avenue H and the federal government's data hub.

Herbert told the secretary both he and Lockhart have taken the position the state will "not share data about Utah residents or businesses with a federal data hub" and that that must be part of any agreement certifying Avenue H as a state-based exchange.

Lockhart had been strongly opposed to the state taking on any new responsibilities as a result of President Barack Obama's health care reform law. In February, Herbert stopped negotiations with the federal government about the state providing an individual health insurance exchange.

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