POST FALLS - A large group came out Saturday morning to listen to six state lawmakers report on how things are progressing as this year's legislative session unfolds in Boise.

Among the most heavily discussed topics at the Post Falls American Legion were the budget, urban renewal and texting while driving. But it was an audience question about the state's position on rejecting federal money that comes with strings attached that led to a bit of a debate among the legislators.

The lively discussion focused on the health insurance exchange component of the federal Patient Protection and Affordable Care Act signed into law last year by President Barack Obama.

"I don't think you're going to see exchange legislation move forward," said Bob Nonini, R-Post Falls, to which he received a loud round of applause from the crowd of around 60.

Nonini said he opposes the creation of a state-run health insurance exchange because it is being formed with taxpayer dollars and includes too many benefits for insurance companies and industry insiders.

Sen. John Goedde, R-Coeur d'Alene, jumped in and warned that if the Legislature does nothing, the state will be saddled with a federal health insurance exchange.

"You do not want the federal exchange. I'll guarantee you that," Goedde said.

Goedde said that with a local exchange in place, "We will still have control of our own destiny." He said that's if, down the road, the Supreme Court doesn't rule in favor of the states challenging the federal health care law and there is still a Democrat in the White House and a Democrat-controlled U.S. Senate. Nonini said the existing proposal

gives too much power to the large insurance companies in Idaho.

"So, to that I say, if we don't do anything and the feds come in, guess who isn't going to be the big player on the block anymore, Blue Cross of Idaho. The problem with health care in Idaho folks, is there's a monopoly. One company controls it all, Blue Cross of Idaho," Nonini said. "So let the feds bring United Health Care or Aetna, someone who can slap Blue Cross down a little bit. I think we might see our rates go down a little bit."

The crowd applauded Nonini when he said that's why he's willing to fight the creation of a local exchange.

"You have a statewide local gorilla, and then you've got a federal gorilla, guess who wins?" Goedde asked.

Nonini responded: "Well, the federal gorilla's going to have lower rates than Blue Cross of Idaho and we break a monopoly."

Vito Barbieri, R-Dalton Gardens, warned that the way this health insurance exchange is handled and funded will have a signifcant affect on the national economy.

Frank Henderson, R-Post Falls, said he and Nonini have had frequent discussions about having private sector insurance companies handle funding an exchange because they will be profiting from it.

"Why don't they pay the cost? Why do we have to look at any requirement that the government pays for it?" Henderson said. "That's our ambition, to find a solution where the private sector does its function to help us all buy insurance more economically."

Called "Legislators' Report" meetings, these Saturday morning gatherings take place throughout the Legislative Session. They are hosted by the Kootenai County Reagan Republicans, North Idaho Pachyderms and Panhandle Pachyderms.