Members of Congress came to the fall meeting of the National Association of Insurance Commissioners to stump for a bill that could turn states into health insurance reform laboratories.

Rep. Tammy Baldwin, D-Wis., and Rep. Tom Price, R-Ga., described their bill, H.R. 506, the Health Partnership Through Creative Federalism Act, here at an NAIC government relations leadership council session.

The bill calls for the federal government to form a bipartisan State Health Innovation Commission that would offer grants to states, groups of states and portions of states.

Grant recipients could use the money – and exemptions from some of the usual laws and regulations governing health insurance – to experiment with ideas such as creating new tax credits, expanding Medicaid or State Children’s Health Insurance Program plans, forming new pooling arrangements, setting up single-payer systems, or beefing up health savings account options, Baldwin and Price said.

Baldwin said she hopes implementing the health insurance regulation pilot program would give new life to existing reform ideas.

The bill recognizes that “states already have a leg up on the feds when it comes to health care,” Price said.

One bill feature would allow for “very narrow” exemptions from federal laws such as the Employee Retirement Income Security Act, Baldwin and Price said.

In response to questions about whether the bill would affect ERISA preemption of state health insurance laws, Baldwin said she has been told that “touching ERISA is like touching the third rail.”

“Our bill would allow for an ERISA waiver, and to do other than an amendment or a clarification would be an uphill journey,” Baldwin said

“It is accurate that ERISA is a third rail,” Price said. “But the beauty of the bill is that you can ask for a specific exemption to a portion of ERISA.”

Sandy Praeger, president-elect of the NAIC, Kansas City, Mo., and Kansas insurance commissioner, noted that ERISA preemption has been a problem for state insurance regulators and asked what regulators could do to help advance the bill.

Joel Ario, who is now the Pennsylvania insurance commissioner and was the Oregon insurance administrator, suggested that commissioners and governors send letters supporting the bill.