Health exchange bill passes House; abortion restrictions out

Landmark health insurance legislation is on its way to the Minnesota Senate after the House on Wednesday night approved a bill enacting a Minnesota health insurance exchange, a cornerstone of the federal Affordable Care act health care law.

The House approved the bill largely along party lines 72-61, but the legislation had a bumpy ride getting out the door. At times the process was beset by procedural problems and abrupt schedule changes; at first, members suspended their own rules and began debate mid-afternoon instead of waiting until the evening. Even after a break, opponents -- mostly Republicans -- didn't let up in their criticism of the legislation.

Abortion coverage was a key consideration for them. House Minority leader Kurt Daudt, R-Crown, wanted to send the bill back to conference committee because he said it removed a House provision that banned abortion coverage except to save the life of the mother, or in cases of rape or incest.

"I know that that particular issue had broad bipartisan support. We had 12 Democrats and all the Republicans supporting that provision to go into the bill," he said.

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The earlier Senate bill did not include the abortion coverage ban.

Daudt also said the bill fell short of the needs of employers and the state's economy.

"Is this bill going to make Minnesota more competitive? Is this going to help job creators in Minnesota do what they do best? Create jobs? Unfortunately I think the answer to that question right now is, 'no.' "

"Rep. Daudt, you gave a nice speech," countered Rep. Joe Atkins, DFL-Inver Grove Heights, the House bill's chief sponsor. "It just kind of lacked one thing, which is facts."

Atkins, also a member of the conference committee, said the exchange would remove $150 million in business taxes that help fund the state's safety net insurance for high risk Minnesotans that health plans won't cover. The exchange would also eliminate $150 million in uncompensated care, he said.

"So that's $300 million. That's impact on the business community, on the insurance carriers, not to mention the fact that the average Minnesota family is anticipated to save over $490 a year," Atkins said.

"This is without a doubt the most significant health insurance reform in 50 years," he added. "Not since Medicaid or Medicare in 1965, have we seen anything this significant."

The exchange is expected to cost between $50 million and $60 million a year to operate. The conference committee decided to fund the exchange through a kind of user fee, a 1.5 percent withhold from premiums sold on the exchange in 2014, and up to 3.5 percent in 2015.

The exchange is expected to provide government health coverage to about 700,000 Minnesotans and at least another 300,000 Minnesotans in the individual and small group markets.

Majority Leader Erin Murphy, DFL-St. Paul, called for a recess after about 90 minutes of debate, until 9:30 p.m., to allow for committee meetings. When House members returned, the passion from opponents such as Rep. Glenn Gruenhagen, R-Delano, had not subsided.

"This bill, it's going to damage one of the best health care systems in the world with stinking growth of government! That's a bunch of nonsense!" he said.

Rep. Kathy Lohmer, R-Elmo, echoed those thoughts.

"The whole idea of the exchange to me is a monumental bait and switch. I hope I'm wrong, but I see 2014 and the federal government taking over this exchange," she said.

But a federal exchange is exactly what supporters of the Minnesota bill say is in the state's future if lawmakers don't meet it March 31 state and federal deadlines to establish the state's own.

Before the House vote, Gov. Mark Dayton, who had recently called the exchange a gamble, said he thought the conference committee's compromises were reasonable and that he'd sign the bill enthusiastically. He was already thinking about appointing the seven-member board that would provide oversight for the system if the bill becomes law.

"I pushed hard for this to have to go through the open appointments process so that we would allow for everyone in Minnesota who has expertise and wants to be involved in this to come forward and be considered for the board. And I'm going to appoint the best qualified board I possibly can and make this a success in Minnesota," Dayton said.

Right now, Minnesota is one of at least 17 states aiming to operate its own insurance exchange instead of opting for the federal government's version.

(Reporter Tom Scheck contributed to this report.)