COLUMBIA -- Gov. Nikki Haley will not apply for millions in federal money to set up a health insurance exchange in South Carolina because she says the state can't afford it and doesn't want it.
The State newspaper reported Thursday that neither Haley nor Tony Keck, the head of the state Department of Health and Human Services, think insurance exchanges are right for South Carolina.
The online exchanges are the centerpiece of the federal health care reform. They are designed to allow uninsured people to compare policies from private companies and buy the one best for their needs.
A state committee set up with an earlier $1 million federal grant to plan the exchanges has estimated it will cost about $5.3 million in fiscal 2012 for the planning process.
"The governor remains an equal-opportunity opponent of ObamaCare, the spending disaster that South Carolina does not want and cannot afford," said Rob Godfrey, Haley's spokesman. "She and Tony Keck are focused on finding South Carolina solutions that provide our state with the most health at the least cost."
Keck said federal rules for the exchanges are not clear, making some states hesitant to accept the money. He said it's not clear how states will distribute federal subsidies to private insurance companies and what parts of the program state governments will run and what parts Washington will run.
"Right now, it's smarter for the state to wait and see what rules actually come down and what solutions the federal government comes up with," Keck said. He said if later it makes sense for South Carolina to run the program "then we'll run it. But that may be years off."
The U.S. Department of Health and Human Services said 16 states and Washington D.C. have so far accepted the federal funds.
South Carolina Democrats charge Haley is playing politics with an issue that affects thousands in the state.
"Governor Haley and all these people spouting the rhetoric have good health coverage," said Rep. Gilda Cobb-Hunter, D-Orangeburg, who sponsored a bill last session to set up a state health exchange. "The people who don't have a place at the table, their voices are not being heard."
About 21 percent of South Carolinians under age 65 are not insured, according to a 2004 survey by the state Department of Insurance. A new study is now being conducted.