The Center for Open government has learned that the Beshear administration has paused their effort to stand up a government-sponsored “public option” health plan.

In an email obtained through Kentucky’s open records statutes, the Department for Medicaid Services informed their “BHP Partners” that “after further consideration, Kentucky has placed development of a Basic Health Program on hold.”

An April article in Politico first reported:

Two states are dusting off a little-used provision of the Affordable Care Act hoping to make health care more affordable for tens of thousands of low-income residents.

Oregon and Kentucky, despite their wildly different politics, are pursuing an Obama-era policy that uses federal dollars to establish a health insurance plan for people who make too much money to qualify for their state’s Medicaid programs. While the policy, known as the basic health program (BHP), was included in the Affordable Care Act, only Minnesota and New York took advantage, and it has been six years since a new one was created.

The Bluegrass Institute’s Center for Open Government posted about CHFS’s plan to launch a Basic Health Program (BHP) last month. We wrote, “a BHP would be the state-level equivalent of the public option, a government-backed health insurance program competing in the private marketplace.”

An interesting detail from the Politico article was the support for the initiative from both sides of Kentucky’s political spectrum. From our post:

Politico went to Emily Beauregard, executive director for the liberal advocacy group Kentucky Voices for Health for comment. Beauregard said, “It’s clear to see where the gaps lie, and which populations technically have coverage options, but not coverage options that work for them.”

In the same article, Rep. Kim Moser, a Republican who chairs the House Health and Family Services Committee, echoed Beauregard’s sentiments. Moser told Politico, “Kentucky is not known for our great health metrics, and we’re doing our best to really address some of the gaps and barriers in the system.”

Digging a little deeper, we uncovered that the General Assembly had tasked CHFS with developing a BHP:

In 2021, both houses of the legislature unanimously passed — and Governor Beshear signed — a joint resolution “directing the Cabinet for Health and Family Services to establish a work group to assess the feasibility of implementing a bridge insurance program.” House Speaker Pro Tempore David Meade, R-Stanford, was the resolution’s primary sponsor; Rep. Moser was the first listed co-sponsor.

The legislative findings assigning this responsibility to CHFS included that “Section 1331 of the Affordable Care Act gives the states the option to create a Basic Health Program, or bridge insurance program” and that “a bridge insurance program offers health coverage to low-income individuals otherwise eligible to purchase insurance through the Health Insurance Marketplace.”

That post continued:

At some point during the ‘22 session, someone or some organization took the time to educate legislators on what exactly a BHP was designed to do: compete within the private exchange marketplace.

The budget bill, which has the force of law for the two-year biennium, included language prohibiting the Beshear administration from “exercising the state’s option to develop a basic health program…without first obtaining specific authorization from the General Assembly.”

It’s possible that policymakers like Moser didn’t fully understand what they were signing onto. It happens all the time in the legislature. Thankfully, members involved in writing the budget put the brakes on it.

The Beshear administration has now applied the brakes too. Their email, however, did leave open the possibility it would “reach out if (they) decide to restart the initiative.”

The General Assembly started Kentucky down this path.

It has the opportunity in the ‘23 session to close the door on the possibility that a government-sponsored health plan could someday be resurrected.