THE BLOG

Health Insurance Exchanges Looking Costlier To Set Up

04/10/2013 06:02 pm ET | Updated Jun 10, 2013

Buried in the $3.8 trillion budget President Barack Obama sent to Congress Wednesday is a small item of potentially big significance. The White House now says it it spent more than double what they thought they would carrying out a key element of health care reform.

A couple billion dollars isn't much in the context of a health care law that will spend about $1 trillion over a decade to provide tens of millions of people with health care coverage. But the higher spending is further evidence that the Obama administration is juggling a lot of balls in the run-up to next year when the biggest parts of the health care reform law are supposed to be online.

Specifically, Bloomberg News reports Obama spent $4.4 billion during fiscal years 2012 and 2013 to help states set up health insurance exchanges, the marketplaces created by Obamacare where small companies and individuals will be able to shop for health insurance plans and learn whether they qualify for financial assistance. Last year, the White House projected this program would cost about $2 billion through fiscal year 2013.

The Obama administration expects that amount to rise to $5.7 billion by the end of fiscal year 2014, according to Bloomberg News, which sums up the situation like this:

The unanticipated spending is a consequence of an ambitious timetable dictated by Congress and a complex new way of offering people medical coverage, say analysts, lobbyists and administration officials. Combine that with a majority of Republican governors declining to cooperate with a Democratic president and U.S. regulators are left grasping to get the 2010 health law up and running by a Jan. 1, 2014, deadline.

Eighteen states and the District of Columbia are setting up health insurance exchanges, which the Obama administration calls health insurance marketplaces, and are eligible for federal grants to help get them ready by Oct. 1 for consumers to shop for coverage that would take effect on Jan. 1, 2014.

The newly revealed spending doesn't account for the fact that federal authorities are responsible to establishing and running health insurance exchanges in the 33 states -- most of which have Republican governors opposed to Obamacare -- that refused to do it themselves. According to The Hill, the White House wants another $1.5 billion for these efforts.

With congressional Republicans steadfast in their antipathy for the health care reform law and their continuing desire to repeal, Obama's probably not holding his breath waiting for more money to facilitate its successful implementation.