Nebraska officials insist they're ready to move forward with a state-based health insurance exchange if the U.S. Supreme Court upholds President Barack Obama's health care overhaul.
The state doesn't yet have a law setting up an online insurance marketplace, a key part of the health care law, but the Nebraska Department of Insurance has been planning for one.
The Supreme Court is expected to rule Thursday on the law, which seeks to extend health insurance to millions of Americans without health insurance.
Nebraska lawmakers say little will happen in the state if the court rejects all or most of the law, but a ruling in support of it would set off a scramble to establish a state-based exchange that would allow residents to comparison shop for insurance. States have a Nov. 16 deadline to submit plans to the federal government, and those that fail to come up with their own exchanges could see the federal government step in and take over.
Omaha Sen. Rich Pahls, a Republican who heads the Legislature's Banking, Commerce and Insurance Committee, said the Department of Insurance has been working "behind the scenes" in case the law is upheld.
"This will be do-able," Pahls said.
To move forward with the exchange, Republican Gov. Dave Heineman could issue an executive order. Heineman opposes the federal law but still ordered the Department of Insurance to plan for the federal requirements.
A Heineman spokeswoman declined to comment, saying the governor would not speak about the impact on Nebraska until after the court has ruled. But Nebraska Department of Insurance Director Bruce Ramge told a legislative panel in February that Heineman would use an executive order to allow the state to move forward before a June 29 federal deadline that has since been extended.
Asked whether Heineman still planned to use an executive order, Ramge said Tuesday: "We believe this is a viable option should that be necessary. I am unable to speculate further on this issue."
Roughly 237,000 Nebraska residents — about 13 percent of the population — are uninsured, according to 2011 U.S. census data. Nationally, 49.9 million Americans — about 16 percent of the country — are not covered.
Pahls noted Nebraska has a lower uninsured rate than the national average, and the state already offers a comprehensive insurance pool for high-risk patients who don't qualify for Medicaid and can't afford to buy private coverage.
Omaha Sen. Jeremy Nordquist and other Democrats have argued that Nebraska officials should have done more, saying the state faces a "tremendous undertaking" in setting up the exchanges and preparing to coordinate care for participants. Nordquist, a vocal supporter of the law, said the Department of Insurance has studied the matter but has held only a few public forums, and those were nearly a year ago.
He said he wouldn't oppose an executive order to keep the process moving, as long as lawmakers and the general public are allowed to help create the final product.
"After Thursday, when we have a sense of where the court sets this, we're going to need to move very quickly. My concern is, it's going to be very difficult to engage the public in a meaningful way," he said.
Nordquist said even if the federal law is thrown out, Nebraska should move forward with a proposal to extend health care coverage to more residents. He said the current state coverage for high-risk patients is expensive, and residents must be uninsured for six months before they can qualify.
The health insurance exchanges are designed to let customers compare prices, and most people who enroll would likely qualify for taxpayer-financed subsidies. The exchanges must be operational by 2014.
Lawmakers, health care advocates and the insurance industry generally agree that Nebraska should establish a state-based exchange if the law is upheld, rather than opt for a regional program or one run by the federal government. Lawmakers floated two bills this year — neither of which passed — that took different approaches in creating an exchange.
Pahls introduced a measure that would give control of the exchanges to the Nebraska Department of Insurance, which reports to Heineman. Nordquist, meanwhile, introduced a measure to create an independent 11-member board made up of consumers, small business owners, health care providers, health insurance carriers and agents, and state officials. The governor would appoint the board's members, but they would operate separately from the Department of Insurance.
That agency has received $6.4 million in federal money so far to plan the exchanges and is eligible to apply for additional grants if the law is upheld, Ramge said.
A state-commissioned study released in 2010 concluded the federal law would increase Nebraska's Medicaid costs by $526 million to $766 million over the next decade. In May, a state-by-state report commissioned by the Kaiser Commission on Medicaid and the Uninsured estimated a much lower cost of between $106 million and $155 million.
Lawmakers have scheduled a special hearing on July 19 for an update on the state health insurance exchanges.