CARSON CITY -- Gov. Jim Gibbons announced Wednesday that Nevada will not operate a health insurance pool for people with high-risk pre-existing medical conditions because the national health care reform bill provides only a fraction of the money needed to run it properly.
In a letter to Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, Gibbons said he was "opting out."
The states of Georgia and Nebraska took similar action earlier this week.
Gibbons' decision is not expected to delay health insurance coverage for any high-risk Nevadans because the federal government will run insurance pools for states that decline. Governors are required to inform Sebelius of their decisions by Friday.
Gibbons said the money the federal government was expected to give Nevada under the state's calculations -- $61 million -- would cover only 2,900 high-risk patients when state officials predicted 100,000 would qualify for the pool.
The Obama administration set aside $5 billion nationally to create a network of insurance pools by July 1 for people with pre-existing medical conditions who cannot get insurance through an employer or on their own.
Thirty-five states already operate their own high-risk pools.
Under the new law, if states such as Nevada decide against operating a pool, then the U.S. Department of Health and Human Services will run the program in those states.
The pools are meant to last only until 2014 when the national health reform law will prevent insurance companies from denying coverage to people with pre-existing conditions.
Gibbons has been a harsh critic of the health care reform law. Over the objections of state Attorney General Catherine Cortez Masto, he retained Las Vegas lawyer Mark Hutchison to file a state lawsuit that challenges the law's constitutionality.
About 18 states have either filed or are considering filing lawsuits over the law. Hutchison, former chairman of the Nevada Ethics Commission, has agreed to work for free.
As he has done almost on a daily basis, Gibbons on Wednesday blamed U.S. Senate Majority Leader Harry Reid, D-Nev., for leaving Nevada with a big money hole through his work to pass health care reform.
"Harry Reid's idea of reform might be breaking the backs and bank accounts of hard-working Nevadans, but it is not mine," Gibbons said in a statement. "I will continue to fight against this unconstitutional and costly law."
Reid's staff quickly issued a statement criticizing Gibbons.
"Jim Gibbons is once again proving whose side he is on, and it's not on the side of struggling Nevadans," said Jon Summers, a Reid spokesman. "He is turning down $61 million that Senator Reid helped secure for our state to help people who can't get insurance because of pre-existing conditions."
Gibbons assigned a team of top state officials, including Mike Willden, director of the state Department of Health and Human Services; Charles Duarte, who supervises the state Medicaid program; and Scott Kipper, the state insurance commissioner, to look into the costs Nevada would incur under the federal health care reform law in its entirety.
"Initial planning to implement health care reform has already cost Nevadans over $55,000 in staff time, diverting our work away from our core mission of serving Nevadans during this recession," Gibbons said in a statement. "Ongoing planning costs of nearly $22,000 per week are expected with costs only increasing in the future."
Earlier, the governor projected the new law would cost Nevada $575 million between 2014 and 2019 because of the expected increase of 100,000 people who would qualify for free health care through Medicaid.
Duarte said that even with Nevada's decision not to run the high-risk pool, people can receive care through the program.
"We were given the option of letting the feds run it," he said. "Not enough money was appropriated to adequately fund it."
Kipper said they calculated that insurance premiums for high-risk patients would cost $10,000 to $12,000 over the next 3½ years and "very conservatively" 100,000 uninsured people would qualify.
He said that 500,000 to 525,000 people in Nevada are uninsured and one in five would be considered a high risk.
"Insurance is very expensive in this country," Kipper said.
Contact Capital Bureau Chief Ed Vogel at evogel@ reviewjournal.com or 775-687-3900.