The Associated Press is reporting that Arkansas Democratic Governor Mike Beebe "is unlikely to seek a $3.8 million grant to research how to establish a health insurance exchange for Arkansas because several top Republican lawmakers have told him they oppose the plan."
In Michigan, the Snyder administration also plans to apply for what appears to be the same kind of federal grant by the end of this week. Health care policy expert Ed Haislmaier of the Heritage Foundation told Michigan Capital Confidential last week that these grants come with strings attached that increasingly commit the state to creating an Obamacare exchange.*
The same concern was expressed by Arkansas House Minority Leader John Burris, quoted in the Arkansas News saying: “By accepting the federal moneys, you obligate yourself to construct the exchange that the federal government wants you to construct, and so, and I state this in the letter, it’s somewhat of a ‘jump or get pushed,’ but we end up in the same place.”
However, Arkansas state Insurance Commissioner Jay Bradford told the newspaper the grant does not obligate the state, because it “could still bail out” as late as June, 2012.
Crains reports that Michigan will also apply for a PPACA Information Technology grant by year’s end, and quotes a state licensing bureau official who says this requires enactment of legislation here creating an exchange.
The Arkansas News provides additional detail on the letter to Gov. Beebe: "The Republican legislators said in their letter that moving forward with an exchange could undermine lawsuits challenging the health care overhaul; that more grant money will be available next year; that there are too many unanswered questions about the exchange; that federal rules and deadlines are likely to change since only 13 states have so far embraced creating exchanges; and that the exchange potentially could bankrupt the state's Medicaid budget."
* Haislmaier posted a blog today with many more details, concluding: "The combined effect of these regulations and grant requirements are that a state would have to agree to surrender any last vestiges of meaningful control over how Obamacare is implemented. Thus, a state would now have no more real control over an exchange it set up than over one HHS established... Consequently, at this point the best course of action for states is to neither apply for nor accept exchange establishment grant funding."