Kansas is giving a $31.5 million health insurance exchange “early innovator” grant back to the U.S. Department of Health and Human Services, according to Kansas Gov. Sam Brownback.

Sandy Praeger, the Kansas insurance commissioner, is the chair of the Health Insurance and Managed Committee at the National Association of Insurance Commissioners (NAIC), Kansas City, Mo., and she has helped lead NAIC efforts to help states implement the Patient Protection and Affordable Care Act of 2010.

One PPACA provision is supposed to create a system of state-supervised health insurance exchanges for individuals and small groups starting in 2014. A state can choose between starting an exchange or letting the federal government provide exchange services for its residents.

Kansas is keeping a $1 million grant it received to plan its own exchange efforts, but it is returning the other, larger grant, which was supposed to support efforts by officials and others in Kansas to help all states with setting up exchanges.

Brownback, R., says in a statement that states already face uncertainty about the ability of the federal government to meet already-budgeted future spending obligations.

“Every state should be preparing for fewer federal resources, not more,” Brownback says. “To deal with that reality, Kansas needs to maintain maximum flexibility. That requires freeing Kansas from the strings attached to the early innovator grant.”

Officials in Oklahoma decided to return an early innovator grant in April.

Praeger says she believes using the innovator grant and the planning grant would help Kansas keep control over the health care system in Kansas.

“If we don’t plan for a Kansas exchange, the federal government could decide what a Kansas exchange looks like,” Praeger says. “We are reviewing work on the exchange in light of the other grants we have received for PPACA implementation and the action of the governor’s office in withdrawing from the innovator grant program.”

The Kansas Insurance Department will continue to try to give people in Kansas chances to shares their ideas about the exchange program, and the Kansas department will continue to try to give its views on what the exchange should look like, whether the exchange is run by the state or by the federal government, Praeger says.

“Since January, many volunteers have spent countless hours working with the insurance department and with others on the beginning stages of the exchange,” Praeger says. “I want to make sure that they know how much I appreciate their willingness to help come up with a Kansas-based solution.”

Other health insurance exchange coverage from National Underwriter Life & Health: