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Health exchange could cost state $54 million in 2015

The proposed health insurance exchange in Minnesota, part of the Affordable Care Act of 2010 or “Obamacare” as some call it, is expected to cost $54 million to operate by 2015.

A major component of the plan includes a website where users can compare health insurance rates. The Pioneer Press says it will allow consumers to buy insurance plans much like they buy airline tickets through websites like Travelocity or Orbitz.

Minnesota is receiving about $71 million in federal grants to fund the program through 2014. MPR reports the Dayton administration is also seeking an additional $39 million, bringing the total to $110 million from the feds.

The proposal has not established how the state will fund the new marketplace once it’s supposed to be self-sustaining in 2015. Charging user fees, a “sin tax” on risky health behaviors like smoking or the sale of naming rights are being considered as sources of funding.

States have the choice to develop their own exchange plan or adopt a federally-run program as part of the heath care overhaul. According to CNN, 15 states have established state exchanges so far, with four planning to set up partnerships.

Fourteen states including Wisconsin opted not to create exchanges. Similar to other Republican governors, Wisconsin Gov. Scott Walker says the cost of a state-run exchange would be an extra burden on taxpayers.

Obama administration officials have not provided any information, including costs, in regard to plans for the federal exchange, the New York Times reports.

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April 24, 2014