Research & Commentary: Wyoming Health Insurance Exchange and Medicaid Expansion

Published September 19, 2012

Like most states after the Supreme Court decision on the Patient Protection and Affordable Care Act (PPACA), Wyoming continues to debate how best to maintain control over its health care system. The two main questions are whether to implement a health insurance exchange and whether to expand Medicaid.

Those who favor state implementation of a health insurance exchange argue doing so will increase competition and thus decrease health care costs. However, Wyoming missed the deadline to create a health insurance exchange, and Gov. Matt Mead is faulting the federal government.

“There are questions unanswered,” he stated. “So if and until we get answers to those questions, I don’t think it’s responsible for the federal government to say we’ve got to make very big decisions that can impact our state budget and quality of our health delivery system in Wyoming.”

Many who opposed the exchanges have agreed with Mead: States do not have enough information, they say, to make responsible, educated decisions regarding health insurance exchanges. There are, however, some things states do know for certain:

* No matter what type of exchange is implemented, states will not have full authority over their health care systems. As stated by the final HHS exchange rules, PPACA “does not contemplate divided authority over an Exchange.”

* The threat of a federally run exchange is hollow: PPACA does not provide the federal government with adequate funding to set up or operate federal health insurance exchanges.

* Implementing an exchange will result in high administrative and operational costs, which will rise further soon after initial implementation. Federal funding for exchanges is expected to run out by 2014, making state spending increases inevitable.

* Only two exchanges are currently in operation in the United States: Utah’s and the Massachusetts Commonwealth Connector. To date, both have failed to produce low-cost or consumer-driven health care.

By resisting implementation of a health insurance exchange, Wyoming can allow the federal government to be responsible for a system set to fail.

Wyoming must also decide whether to expand its Medicaid program. Those in favor of expansion say doing so will increase access to health care for Wyoming residents in need and, because primarily funded by the federal government, the expansion will not be too great a burden to the state. However, a recent study reported by The Republic finds expansion would cost Wyoming between $116 million and $148 million just between 2014 and the end of the decade. In addition, full federal coverage of new enrollees will end in 2020, leaving the state to make up the difference.

Many states already have decided against expansion. Wyoming would be wise to resist ceding more control of its Medicaid program while further expanding a system that is already fiscally unsustainable.

The following documents offer additional information about health insurance exchanges and Medicaid expansion.


Gov. Matt Mead Blames Feds for State Missing Health Care Law Deadline on Insurance Exchanges–Wyoming-Health

Ben Neary of the Associated Press discusses Gov. Mead’s reasons for missing the federal deadline to implement a health insurance exchange. Mead claims it is the fault of the federal government for not responding with requested information.

Research & Commentary: HHS Final Exchange Rules

Heartland Institute Policy Analyst Kendall Antekeier explains the final health insurance exchange rules from the U.S. Department of Health and Human Services and tells what information is still missing. “The final rules give no information regarding how a federally run exchange would function or how it would be funded,” she notes.

State Insurance Exchanges: The Case Against Implementation

Health Care News Managing Editor and Heartland Institute Research Fellow Benjamin Domenech gives several reasons states should avoid implementing a health insurance exchange. “Any exchange created to pass muster with HHS Secretary Kathleen Sebelius and the current rules within Obama’s law will be fundamentally flawed,” he concludes.

Policy Tip Sheet—State Health Insurance Exchanges Post-SCOTUS

Kendall Antekeier outlines the arguments against state health insurance exchange implementation and provides facts about previously attempted exchanges. Antekeier writes, “If a state moves forward with implementing an exchange, it could invest valuable time and taxpayer dollars in developing a system only to discover it does not comply with final federal regulations.”

Medicaid: To Expand or Not To Expand

Nicole Kaeding of Americans for Prosperity argues states should avoid expanding their Medicaid programs because doing so would support the flawed and expensive federal health care law, place heavy financial burdens upon the state, and extend an already-broken system.

The End of Federalism: How Obamacare Will Impact States

A fact sheet from The Heritage Foundation outlines the consequences of expanding Medicaid programs to match federal requirements.

Mario Loyola: Challenging the Constitutionality of Obamacare’s Medicaid Expansion

In a podcast for Coffee & Markets, Mario Loyola describes why he and many other analysts consider the federal health care law’s Medicaid expansion to be unconstitutional.


Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this subject, visit Health Care News at, The Heartland Institute’s website at, and PolicyBot, Heartland’s free online research database at


If you have any questions about this issue or the Heartland Web site, contact Heartland Institute Manager of External Relations Kendall Antekeier at [email protected] or 312/377-4000.