Kasich: Ohio won’t run health exchange

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COLUMBUS – Ohio Governor John Kasich has indicted that the state would not run a health exchange under the Patient Protection and Affordable Care Act (PPACA).

The governor notified the U.S. Department of Health and Human Services that Ohio would not run a health exchange, but instead leave that to the federal government to do. Kasich said the decision was made after investigating all options available to Ohio under the law, including commissioning a separate study to review possible effects of the law.

Main sticking points for the governor is the lack of flexibility given to states over the health exchanges, as well as the operating expenses of the exchanges (estimated at $63 million to set up and $43 million to operate annually). The Ohio study also estimates that costs would be lower if the federal government set up health exchanges in the state, rather than have state government do so.

The governor also said he feels the health exchanges would have a negative effect on Ohio’s insurance industry, which already has more competition and lower costs than those seen in other states. With the second largest number of insurance-related jobs (approximately 400,000) of any state, Ohio’s history of high-quality regulation helps maintain stability in the industry and preserves those jobs.

Governor Kasich stated categorically that his administration would turn over the power to decide who and who cannot receive Medicaid benefits, something allowed under the PPACA, noting that he feels the state would do a better job of managing Medicaid costs — something essential to maintaining Ohio’s newly-regained fiscal stability. Statewide Medicaid reforms have already helped cut the Medicaid growth rate in half.

The governor said he feels that, while he wants every Ohioan to have health care coverage, the best way to do so is under a market-based system that encourages both high quality and low costs.

“A rigid, prescriptive health insurance exchange that reduces choice and drives up costs does not align with the Kasich Administration’s health policy goals,” the governor said in a factsheet explaining his decision to not run a state health exchange.