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RAYMORE, Mo. – The federal health law has been a contentious issue around the country, and Missouri is no exception. Last year, voters overwhelmingly passed Proposition C, a measure opposing any federal mandate that would require people to buy health insurance. Just last month, the state attorney general filed a legal brief in support of a Florida challenge to the law. But amid these disputes, Missouri lawmakers from both parties have been advancing a key part of the law: the creation of a state-based health insurance exchange. KCUR's Elana Gordon recently caught up with a leader of the effort, Republican Chris Molendorp.
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When state representative Chris Molendorp is not in session in Jef. City, he's usually back here in his hometown of Raymore, Missouri - a suburb south of Kansas City - running the small insurance agency his dad started in 1977. Dad, who's 70 now, is still an agent. But today he's more of the company landscaper and is outside mowing the lawn. Molendorp, meanwhile, has been at his desk all day, fielding phone calls and claims requests.
"I've got a couple customers wanting to talk about recent hail storms and getting their claims finalized and settled," Molendorp says.
Within the state legislature, Molendorp chairs the House health insurance committee. He's spent the last few months at the capitol crafting legislation that would establish a health insurance exchange for the state.
Under the federal health law, if states choose not to set up an exchange, the federal government will step in and create one instead. Molendorp, who's a Republican, says that's why his efforts have not carried the same kind of political rancor as other parts of the law.
"It doesn't matter if you're Democrat or Republican," Moldendorp says. "Missouri lawmakers would like to have some control over a health insurance exchange, if indeed the federal bill is not thrown out by the courts."
Molendorp says all the legal and popular challenges to the federal health law, like Missouri's proposition C, which he supported, mainly focus on the law's individual insurance mandate. He says assuming the state exchange section of the law isn't affected by these challenges, he'd prefer Missouri prepare for and oversee something that could have big impacts on the state's budget and residents' access to health care.
As for how an actual exchange would work, Molendorp says the idea really isn't anything new.
"People already buy insurance through exchanges. Esurance.com is an insurance exchange," says Molendorp. "Progressive.com is an insurance exchange. You can view multiple policies and prices at those websites."
That may be the case for, say, car insurance, but Molendorp also says applying the concept to health insurance in Missouri is uncharted territory.
"It's been put down on paper, it's been described in the federal health care bill, but no one's ever seen one or exactly participated in one," says Molendorp.
Molendorp, who's also served on a local hospital board, says the few health exchanges which already exist in states like Massachusetts and Utah wouldn't work in Missouri. Massachusetts uses a lot of state dollars; Utah has a much smaller population.
So since the start of this year's legislative session, Molendorp's been busy meeting with lawmakers and health care stakeholders, in order to design an exchange for Missouri. It's house bill 609, otherwise known as the "Show-Me Health Insurance Exchange Act." Molendorp likens his plan to the way a lot of people book airline tickets.
"It's almost like a Travelocity model," Molendorp says. "We would like to have an exchange that gives you the option of calling an 800 number to obtain information, going online to shop and compare, or very simply going to an insurance agent if they choose to sell for the exchange, and obtaining coverage there."
Molendorp says the show-me exchange would allow people to view multiple insurance plans at once and compare policies and prices - even for things as specific as how much a gall bladder surgery would cost with one company verses another.
The bill sets up the exchange as a quasi-government agency, with funding coming from federal grants and insurance company fees.
Once the exchange is actually up and running, not all Missourians would get health coverage through it. Low-income residents, like a family of four making up to $30,000 a year, would be eligible for Medicaid instead. And people working for large companies would keep their current coverage. On the other hand:
"If you are currently in the state high risk pool, on January 1, 2014 you will be moved into your state's exchange. So we're going to have about 5,000 customers the first day we open our doors," Molendorp says.
The federal health law also allows states to open up their exchanges to businesses that have up to a hundred workers.
"We've picked the number fifty to focus more on smaller groups," Molendorp says. "So they would be eligible January 1, 2014 to get coverage from one of the insurance companies participating in the exchange."
People who buy health insurance on their own could also go through the exchange.
But before any of this can happen, Molendorp says getting the exchange ready for people to use will take a lot of work.
"You have to first of all, find the number of insurance companies that want to participate in the exchange. Like Travelocity or Expedia, I need to know if Frontier Airlines wants in, or if they want to be like Southwest Airlines and not participate in Expedia. I need to know if United wants to be in, Blue Cross of Kansas City, Coventry, Aetna, the list goes on and on. We're building an insurance company, and we're building it with multiple carriers in an exchange format," Molendorp says. "I've got to negotiate provider contracts with hospitals, doctors, radiology groups, anesthesiology groups. I need to set up the framework with legal and accounting. I have to build a website. I have to enter into contracts with brokers.
Molendorp says Missouri is on a short time frame to get all this done.
"We have to show intent to the Department of Health and Human Services by December of 2011 that we intend to create our own exchange. Well the legislative session ends May 13," Molendorp says.
Molendorp's legislation has passed the House and is now awaiting floor debate in the Senate. But with just a few days left in the session and with possibilities of a filibuster from opponents, chances are slim the bill will be taken up right now. Molendorp says if nothing happens, he plans to introduce it again in the winter.
"We'd absolutely have to get it done in 2012 to dissuade HHS from creating it for us," Molendorp says.
The federal health law says the state exchanges, regardless of who runs them, have to be operational by 2014. Missouri is one of at least two dozen states with an exchange bill pending. Some states, like Maryland and Virginia, have already given the green light to their exchanges. Others, like Georgia and Mississippi, have rejected theirs. Kansas recently applied for and received a federal grant to get an early start on developing its program.
Back in the show-me state, if Molendorp's bill does advance, that might not bode so well for his personal profession.
Inside his office, Molendorp's phone rings.
"Good afternoon, Farmer's Insurance. Hi Chris."
Molendorp jots down the vin number of a new van a customer just bought and gets started on the insurance process.
"Are you buying it in the painting company's name or are you buying it personally?" Molendorp asks.
Molendorp says with all the changes likely coming to the health insurance market, with the demand for brokers likely to be declining, he plans to stick to stuff he's more familiar with - things like car and homeowner insurance.
"We really, dad and I really after the federal health care bill passed last year, we kind of decided we were done selling health insurance," Molendorp says.
Molendorp says they don't handle much health insurance anyway. Even so, he says it's a tradeoff he's accepted, especially if it brings improvements to health insurance in the years ahead.
Legislative Update: The Missouri Senate did not pass HB609.
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