What’s the Real Cost of Shutting Down Kentucky’s Healthcare Exchange?
The Kentucky State Capitol in Frankfort. Henryk Sadura / Shutterstock.com
Gov. Bevin’s administration pegs the net cost at just over 1 percent of the $23 million figure cited by the previous governor, Steve Beshear.
Shutting down Kentucky’s online health insurance marketplace will have a net cost of about $236,000, nowhere near a previously estimated price tag of $23 million, according to information Gov. Matt Bevin’s administration released Wednesday.
Bevin, a Republican who took office in December, has pledged to scrap the healthcare exchange since his time on the campaign trail last year. Known as Kynect, the system launched in 2013 after Bevin’s predecessor, Democrat Steve Beshear, issued an executive order the prior year paving the way for its creation.
During his final weeks in office, Beshear pointed to the $23 million cost figure for shutting down Kynect as he made his case for preserving the exchange. Bevin has disputed the accuracy of that number, including during his inaugural budget address in late January.
By shifting state residents off of Kynect and onto the federal healthcare exchange, Bevin argues that Kentucky will save money. He has written off the state-run insurance marketplace as redundant and not financially self-sustaining.
In recent weeks, Bevin and Beshear have continued to clash over the virtues of Kynect, and the expansion of Kentucky’s Medicaid program under the Affordable Care Act, which Beshear also ushered in during his time in office.
Beshear has gone so far as to spearhead a campaign defending his healthcare initiatives. An online petition that is a part of that effort had 11,134 supporters as of Wednesday afternoon.
The $236,000 net cost estimate to shut down Kynect was included in information Bevin’s Cabinet for Health and Family Services Secretary, Vickie Yates Glisson, presented to state lawmakers on Wednesday. Factored into the cost figure are reduced operations and maintenance expenses for the Kynect website in 2017.
According to Bevin’s office, no general fund dollars will be used to pay for dismantling Kynect.
Bevin is also seeking to scale back Kentucky’s Medicaid expansion. The program provides health coverage for people with low incomes. Under the Affordable Care Act, in states that expanded Medicaid, adults earning up to 138 percent of the federal poverty level can access benefits through the program. In 2015, that income threshold was $16,242 per year for an individual. In the governor’s view, Kentucky cannot afford the program in its current form.
Bill Lucia is a Reporter for Government Executive's Route Fifty.
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