TWIN FALLS • Gov. C.L. “Butch” Otter has announced that Idaho will implement a state-based health insurance exchange under the federal health care reforms, pending legislative approval.

Otter has repeatedly criticized the health care reform law since it passed in 2009. However, in Tuesday’s announcement, Otter argued that a state-run exchange was the best option for Idaho.

Under the Patient Protection and Affordable Care Act, all states must establish an online marketplace where consumers shop and compare health insurance options.

If Idaho declines to establish its own exchange, the federal government will step in to set up its own exchange. Otter had until Friday to announce his decision.

“This decision does not signal support for the law or how it is being implemented,” Otter said in a news statement. “However, it does reflect my continued determination for Idaho to be actively engaged in making the best possible choices — to the degree we are allowed — in the interest of more accessible and affordable health care for our citizens.”

In late October, a working group Otter set up to study the exchanges recommended that Idaho remain in control of setting up its own exchange. The 13-member advisory group suggested that Idaho opt for a state-based exchange, to be run by a nonprofit.

New House Speaker Scott Bedke, R-Oakley, said it’s important to remember the governor can change his mind.

“He’s wanting to keep his options open,” Bedke said. “If it gets to the point where it’s not a good fit or it’s a net loss for the state,” Otter will opt out, Bedke said.

Then there’s the question of the Legislature’s approval. With 44 new lawmakers between the House and the Senate, it’s hard to predict how they’ll vote on the controversial plan.

Sen. Lee Heider, R-Twin Falls and the newly appointed chairman of the Senate Health and Welfare Committee, said Tuesday he is optimistic the Legislature would approve a state-based exchange. Though the sentiment among legislators is generally anti-Affordable Care Act, Heider said most Idahoans recognize the state will have more control with a state-based exchange as opposed to one run by the federal government.

“The problem is none of us have seen that, what it’s going to look like, who’s going to draft the plan,” Heider said.

Bedke said he’s been impressed with the freshman House members, and is confident they’ll research the options before the Jan. 7 start of the 2013 legislative session.

“Keeping in mind that most of us are philosophically in opposition to Obamacare... but elections have consequences,” Bedke said. “And now it’s about doing what’s best for Idahoans.”

Other Republican governors have outright rejected the exchange, including Gov. Rick Perry of Texas, Gov. Bobby Jindal of Louisiana, Gov. Jan Brewer of Arizona and Gov. Scott Walker of Wisconsin.

Wayne Hoffman, executive director of the the Idaho Freedom Foundation, opposed Otter’s decision.

“Gov. Otter’s decision makes the national effort of resistance much more difficult and more likely the law will remain in place, at great cost to Idaho families, businesses and our nation’s economic vitality.” he said in a statement. “Idaho Freedom Foundation will do everything it can, along with other opponents of Obamacare, to make sure Idaho never implements this destructive law.”

Otter’s announcement was a welcome surprise to David Pate, chief executive officer of St. Luke’s Health System.

“I commend Gov. Otter for his deliberate and thoughtful process and for making a decision that’s what’s best for Idaho,” Pate said after the Times-News informed him about the announcement. “I completely concur and support this decision. St. Luke’s will do everything we can do to make this successful for the citizens of Idaho.”

The Idaho Health Exchange Alliance has been urging Idaho state officials to support a state-based exchange. The 400-member coalition of businesses, individuals and trade associations applauded Otter’s decision.

“We’re very grateful that Gov. Otter has shown Idaho the way forward on this issue,” said Heidi Low, executive director of the alliance. “A state-based exchange will help Idaho have more control over Idaho’s health insurance costs and keep Idaho in the driver’s seat on health insurance issues.”

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