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State Healthcare Exchanges Flush $474 Million Down the Drain

Posted on September 17, 2014 by admin

Gambling is risky business. Ultimately, it’s all a game of luck. Tax dollars should not be associated with either. They shouldn’t be gambled. Luck should never enter the equation. When it comes to the cash earned under the sweat of the American brow, every cent should be spent wisely, invested wisely.

Unfortunately for the taxpayers of Maryland, Massachusetts, Nevada and Oregon, that wasn’t the case.

The funds used to make the Affordable Care Act accessible – aka the nation’s tax dollars – were funneled into two sites. The first was the federal exchange, Healthcare.gov. The second was comprised of state-specific exchanges. And from Alabama to Wyoming, it was the state in question that decided which route to take. To join the federal exchange or employ a state-specific site – that was the question.

36 states decided the former was the wiser option. They chose wisely. Since the inception of Healthcare.gov, just $693 million have been spent on the federal exchange. That’s approximately $19 million per state. Conversely, the specific exchanges created for Maryland, Massachusetts, Nevada, and Oregon have tallied up all of $474 million. All in tax dollars. It’s enough to unhinge your jaw.

But before the panic alarm goes off in your mind, there is a saving grace struggling states, and it comes in the form of the Affordable Care Act.

After spending $248 million on a program that never enrolled a single citizen, Oregon representatives declared their intention to join the federal exchange. Given the effectiveness of Obamacare’s federal marketplace – even after a shaky launch – Oregon made the right choice in saving their residents tax dollars. Meanwhile, Nevada and Massachusetts were not so decisive. Nevada took approximately a month to realize that the federal exchange was their best option and Massachusetts’ transition to the national marketplace seems like it may only last until they revamp their state exchange. On the other side of the spectrum – mentioned in a previous article – Maryland is eager to put more money into their state marketplace.

As time has demonstrated – with a keen attention to detail – state exchanges are risky bets. The federal marketplace was the safer investment. And that is the key to understanding the issue. Those that choose the state-specific exchanges are gambling, throwing dice at the craps table. Those who ask for federal assistance, however, show how much they value safety.

Of course, the argument can be made that concern is premature, given that months remain until the next enrollment period. Some say that there is still plenty of time for the “kinks” to be worked out of the state sites. At the same time, and in the same vein, there’s just as much time for these wandering factions to conform to national standards, remove the risk and start saving the American people money. Given what these states have witnessed of their counterparts, you’d think this decision would require little thought.