Senate committee expected to vote on setting up health exchange

A Virginia Senate subcommittee is poised today to begin making decisions about health-care reform that the House of Delegates decided not to tackle.

The three-member panel is expected to vote on a revised version of legislation proposed by Sen. John C. Watkins, R-Powhatan, that would set up a health insurance exchange as a new division of the State Corporation Commission that would be financed initially by the federal government and later by assessments on insurers.

Watkins' bill incorporates a similar proposal by Sen. Richard L. Saslaw, D-Fairfax, as well as provisions from two measures favored by health-care advocates who want the exchange to be a new, quasi-governmental entity that is more accessible to consumers than the industry-oriented SCC.

But the biggest fight has been over whether to act on creating an exchange at all because of pressure from Gov. Bob McDonnell and House Speaker William J. Howell to delay consideration at least until after the U.S. Supreme Court rules in June on the constitutionality of the Patient Protection and Affordable Care Act.

A House subcommittee killed three similar proposals as "premature" last week, but the Senate Commerce and Labor subcommittee, chaired by Sen. Jeffrey L. McWaters, R-Virginia Beach, has held three meetings and six hours of testimony on how to make an exchange work for both the industry and consumers.

"I think the industry is saying, 'We need something to start working on,' " McWaters, a former health insurance executive, said Tuesday. " 'Give us something.' "

The result is legislation that is likely to be opposed by a coalition of consumer groups that doesn't want the exchange housed at the SCC, but it begins the complex work of determining how health plans would compete within and outside of an exchange, as well as how to ensure consumer involvement in the process.

The subcommittee has wrestled with consumer and physician representation on a proposed advisory council to the exchange, whether to require that groups and individuals be certified to act as "navigators" to help consumers through the process, and how far to go to make sure than health plans offered outside of the exchange don't undercut those within it.

"That's why we need to be starting on this thing right now," said Watkins, chairman of the Senate Commerce and Labor Committee. "We've got a lot to get through. I'm glad we're doing it."

If the subcommittee approves Watkins' amended bill today, the legislation still faces a political challenge before the full committee to reach the Senate, where members would have to take a public position on a proposal that is almost sure to die in the House.

McDonnell and Howell have said the state can take up the issue in a special session this year if necessary, or even wait until next year, but even opponents of the federal health-care law say Virginia cannot risk missing looming deadlines that require certification of a state exchange in less than 11 months.

"I have a feeling a feeling this bill is going to have plenty of time to work on," McWaters told subcommittee members on Tuesday. One of them, Sen. Mark L. Herring, D-Loudoun, quipped, "You mean between now and when we come back for a special session?"