Jackson Free Press

JACKSON (AP) — Mississippi Insurance Commissioner Mike Chaney has the authority to establish and manage a health insurance exchange, according to a legal opinion released late Tuesday by the state attorney general's office.

Exchanges are online marketplaces where people can shop for insurance. Under the federal health law that President Barack Obama signed in 2010, every state is required to set up an exchange. States that don't create their own will have one run by Washington.

Gov. Phil Bryant and other Republican governors who oppose exchanges have said they fear the exchange will give the federal government a back-door way to force the expansion of Medicaid, which is also envisioned to be part of the federal health care law.

But Chaney, also a Republican, has said the danger of the federal government diverting people from the exchange to Medicaid will be greater if the state doesn't run the exchange.

"He's ruled in our favor... and we thought that would happen," Chaney said in a telephone interview Tuesday. "We are very encouraged. Now everything will rest with HHS. The ball is in HHS' court."

The Department of Health and Human Services has said it had approved exchange proposals for Washington, D.C., and 17 states, four of which have Republican governors. Officials said they did not act on Mississippi's request because of the split between Bryant and Chaney over who has authority to create or oversee a plan.

"It is the opinion of this office that MID (Mississippi Insurance Department) is vested with authority to submit the application to establish a health insurance exchange," Hood's opinion said. "Our office has found no statute which would allow the governor to override a decision of MID or the commissioner."

Chaney said Bryant may still try to block his efforts to establish the program but noted he had not spoken with the governor.

In a statement late Tuesday, Bryant spokesman Mick Bullock said Bryant wasn't giving up his fight.

"Governor Bryant understands that as a Democrat, General Hood was placed in an extremely difficult position," Bullock said. "Governor Bryant will continue to resist efforts to further implement 'Obamacare,' including a health insurance exchange."

The rift over the health exchange is a rare public dispute between members of the Republican Party, which controls all statewide offices except the attorney general's office.

Chaney's office has been working on an exchange for months, and he has been sharply criticized by tea party conservatives, who believe he is promoting big government.

Chaney disagrees with their criticism, saying exchanges are inevitable and it is in the state's best interest to have as much control as possible.