Senators Orrin Hatch, R-Utah, and John Barrasso, R-Wyo., filed a bill Wednesday that would require states that abandon state-run healthcare exchange plans to pay back the federal grant money they received.
Under the Affordable Care Act states had the option to join the federal healthcare exchange and its website HealthCare.gov or they could opt to receive federal grants and set up their own. The exchanges exist for private citizens to shop for health insurance if they do not receive any from their employer.
Fourteen states opted to set up their own exchanges. According to a recent story from Politico four of those states received $474 million from the federal government and their exchanges don’t work
The legislation now up for consideration would only apply to states that have completely abandoned hopes of a state-run exchange and decided to join the federal exchange. So far the only state that fits the bill is Oregon, where $248 million in federal money was spent despite the exchange’s inability to enroll even one person.
“Taxpayers shouldn't have to pay twice for the mistakes of incompetent state bureaucrats who couldn't set up a working healthcare exchange,” Barrasso said Wednesday, according to Fox News.
Other states that could eventually have to return federal money include Massachusetts, Maryland and Nevada. Massachusetts spent $57 million and is asking for an additional $121 million to fix its ailing system. Maryland spent $118 million and is considering adopting technology used by Connecticut’s successful exchange. The federal government sent $90 million to Nevada but the state has only spent $51 million so far and is still trying to get their exchange working.
If those states get their exchanges running prior to the next open enrollment period they would not be required to pay back the money.
The Heritage Foundation recently indicated that $4.18 billion has been sent to states pay to for their healthcare exchanges. Hatch believes the proposed legislation will ensure that such a large amount of money will not be squandered.
“Hard-working American taxpayers should not be forced to foot the bill for what has already turned into an almost $500 million dollar boondoggle,” he said. “This bill rightly restores accountability by ensuring that the hundreds of millions of dollars wasted by these failed exchanges are returned.”