FRANKFORT, Ky. (LEX 18) — During his Wednesday press conference, Gov. Andy Beshear announced that he has submitted a new declaration of intent letter to transition Kentucky to state-based health care beginning January 1, 2022. Currently, Kentucky uses a federal health exchange to qualify for QHP (Qualified Health Plan) coverage.
In 2013, Kentucky implemented a state-based exchange called Kynect. Gov. Beshear noted that through Kynect, approximately 500,000 newly eligible Kentuckians were enrolled in Medicaid coverage and qualified health plans.
"Kynect was one of the most successful exchanges in the country," Gov. Beshear said. "Because of it, we reduced our uninsured Kentuckians at the highest rate in the country for several straight years. It was the right thing."
Matt Bevin, Kentucky's former governor, dismantled Kynect in 2017 which forced Kentuckians to use the federal health exchange to qualify for QHP coverage. Gov. Beshear noted that to support a federal exchange, a user fee is included in every individual's premium. Under the federal exchange, Kentuckians were paying a 3% user fee to the federal government. Last year, the fee cost Kentuckians 9.8 million dollars.
"Several states are transitioning from the federal exchange to a state-based exchange to avoid this user fee," Gov. Beshear said. "Because each of them are seeing that you can reduce the cost of premiums if we go back to a state-based exchange. We can also improve efficiencies and we believe we are going to be able to offer more opportunities to Kentuckians."
According to Gov. Beshear, the transition to a state-based health care will cost an estimated $5 million. Ongoing costs, year in and year out, will be in between $1 and $2 million dollars as opposed to $9.8 million.
"This saves Kentuckians a reduction in premiums, millions upon millions of dollars," Gov. Beshear said. "We can save significant dollars that we can use to offset the cost of health care."
Gov. Beshear added that state-based health care would also provide local control.
"I believe we can do this much better than the federal government," Beshear said. "We proved that many years ago. As we move forward, this is just going to be one part of a larger set of announcements on health care that we anticipate we will be making in August or potentially in September."