Mississippi Insurance Commissioner Mike Chaney says federal officials have rejected the state's proposed insurance exchange.
An exchange is an online marketplace where people may buy health insurance.
Under the federal health law that President Obama signed in 2010, every state is required to have an exchange so people can get coverage starting in January 2014, much of it federally subsidized.
States that don't create their own will have one run by Washington.
Chaney submitted an exchange proposal to the U.S. Department of Health and Human Services in mid-November.
Gov. Phil Bryant said he has not been officially informed by the Department of Health and Human Services.
"However, I have said repeatedly that the health insurance exchanges mandated by ObamaCare are not free-market exchanges," said Bryant in a written statement. "Instead, they are a portal to a massive and unaffordable new federal entitlement program. They trigger new taxes on businesses and will ultimately drive more people onto Medicaid rolls. I firmly maintain my position that Mississippi will not willfully implement a mechanism that will compromise our state’s financial stability."
Bryant says the Department of Health and Human Services'' refusal to approve Utah’s plan for an exchange proves that the federal government has no intention of allowing states to tailor exchanges to their own unique needs.
"Make no mistake, the federal government will control all exchanges established under the Affordable Care Act," Bryant said.