Fallin to reject $54 million federal health grant


April 15--OKLAHOMA CITY -- Gov. Mary Fallin on Thursday reversed course, saying the state would reject a $54 million federal grant to set up an insurance exchange.

The state, however, will use its own money and private dollars to create a one-stop shopping site on the Internet, where consumers can view and compare health insurance information.

Legislation to facilitate creation of an exchange with the federal funds was derailed last week in a Senate committee.

The governor held a Capitol press conference Thursday with House Speaker Kris Steele, R-Shawnee, and Senate President Pro Tem Brian Bingman, R-Sapulpa, to show unity and announce that Oklahoma would push ahead with its own funding.

The three had announced in February that the state would accept the federal grant. In March, Fallin said she suspected that critics of the grant were "uninformed."

The grant has been a lightning rod of controversy because some conservatives believe it ties Oklahoma to federal health-care reform that the state has challenged in court and voters opposed at the ballot box last November.

"We are working together to address the concerns that have been expressed by some by adding very specific language in the bill to prevent the implementation of federal health-care exchange in Oklahoma while creating an Oklahoma-based solution," Fallin said.

The federal health-care reform law requires states to set up exchanges by 2013 or the federal government will do it for them, the governor said.

Fallin said she, Steele and Bingman opposed federal health-care reform. She made her opposition to federal health-care reform -- which she voted against as a member of Congress -- one of her main campaign issues.

Regardless, it is the law until it is tossed out by a court or repealed or replaced by Congress, Fallin said.

Steele said he believes the state can set up the insurance exchange for considerably less than $54 million, but he could not provide a cost.

"We are $500 million in the hole and the Republicans have decided to turn away $54 million in federal money," said Senate Democratic Caucus Chairman Tom Ivester of Elk City. "I don't understand how this makes sense."

Oklahoma expects to have $500 million less to spend in crafting the fiscal year 2012 budget.

The state exchange will be called the Health Insurance Private Enterprise Network. It would create a public trust governed by a seven-member board made up of health insurance carriers, agents, providers, employer groups and consumers.

Legislation to implement the exchange will originate in the House, Steele said.

The surprise announcement resulted in some Democrats accusing GOP leadership of being coerced by a small but vocal faction of their own party.

Sen. Judy Eason McIntyre, D-Tulsa, said it was a sad day when a small group of ultraconservatives could create so much pressure that Republicans would turn their backs on the health care needs of the state.

"When we have our disasters in Oklahoma, we are the first ones to reach out and ask the same government for help," McIntyre said. "This is what the people of Oklahoma wanted. They disliked the African American president so much they are willing to do without."

"Just two weeks ago, Gov. Fallin defended her decision to accept $54 million from the federal government to implement the state health exchange by arguing that the money was not tied to President Obama's health-care plan and that the state could not afford to do it on our own," said House Democratic Leader Scott Inman of Del City. "Now, just days later, Gov. Fallin admits that the funding is in fact a part of Obama's health-care plan and that somehow, despite our $500 million shortfall, we can afford to do it without these funds.

"The question I have is, was Gov. Fallin wrong then or is she wrong now?"

Fallin's flip-flop is an admission that she was misinformed, Inman said.

"As she has stated all along, Gov. Fallin's ultimate goal has been to prevent the implementation of the president's federal health-care exchange in Oklahoma and the Health Insurance Private Enterprise Network will do just that while offering a free market-based network to increase access to affordable health insurance for Oklahoma families and small businesses," said Aaron Cooper, a Fallin spokesman.

Barbara Hoberock 405-528-2465
barbara.hoberock@tulsaworld.com

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