Legislation to establish a state-based health insurance exchange in Illinois failed to come up for a vote in the House before the Legislature adjourned for the year on Wednesday. That means Illinois won't be able to apply for $270 million in federal funds to build the capacity to run its marketplace without HHS.
Democratic state Rep. Robyn Gabel had been pushing to pass the legislation during this week's special session in the wake of the Supreme Court's decision to take up the King v. Burwell case. That lawsuit could end subsidies for millions of low-income households in 34 states that haven't set up their own exchanges. An analysis by the Urban Institute (PDF) found that 7.3 million people would lose access to $36.1 billion in subsidies in 2016 if the Supreme Court invalidates those benefits.
In Illinois, roughly 167,000 residents have accessed subsidies to help pay for coverage through the exchange. That's roughly 80% of the state's 217,000 total exchange customers. Financial assistance is available for households with incomes up to 400% of the federal poverty level.
Illinois is among seven states that have partnership exchanges, meaning they fulfill some obligations, such as conducting outreach efforts. But those states still rely on the federal HealthCare.gov website for enrollments. The only other state moving forward with plans to establish a state-based exchange is Arkansas.
Republicans indicated they have declined to support state-based exchange legislation in part because they want to wait for Republican Gov.-elect Bruce Rauner to take office, according to Jillian Phillips, director of policy and government relations for the Campaign for Better Health Care, which has been lobbying for Illinois to establish an exchange. Lame-duck Democratic Gov. Pat Quinn supported the legislation, a version of which had previously cleared the state Senate. But federal grant dollars aren't expected to be available after this year to help pay the costs of establishing a state-based exchange.
“The question for the Republicans who frankly let this fail is: Are they going to be willing to use general revenue funds next year?” Phillips said. “What are they willing to do to protect 167,000 people from losing their private insurance coverage?”
But Democrats could have passed the bill without Republican votes. According to a report by Capitol Fax, Speaker of the Illinois House Mike Madigan advised Democratic members in competitive legislative districts to vote against the bill so that they wouldn't be seen as supporting Obamacare. That left the legislation with too few votes to pass.
Gabel didn't deny that Madigan played a role in discouraging Democratic support. “I couldn't get the votes,” she said. “That's one reason.”
Gabel and other supporters of a state-based exchange said they'll reach out to Rauner about possibilities for future action, but for now they'll focus on getting as many qualifying Illinoisans as possible into coverage through the federal exchange. “We'll just have to hope the Supreme Court doesn't rule to eliminate the subsidies on the federal exchange,” Gabel said.
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