This is that rare thing today in GOP discussions of health insurance policy: it makes sense. The Affordable Care Act envisions each state building its own exchange, in order to address the specific concerns and needs of each state. A state has a particularly large rural population, a particularly large elderly population, too few urban hospitals, etc.
If the state refuses or doesn't get around to it, the Feds do it for them. The federal government will make some attempt to customize. But they're not in a position to or able to do so in ways a responsive state government can.
More to the point, a main thrust of opposition to 'Obamacare' is supposedly its 'one size fits all' approach to health care delivery' which takes power from the states and centers it in Washington. So to fight back against this terrible law, Republican governors across the country are refusing to establish their own exchanges and insisting on the one-size-fits-all Washington model. It's senseless on its face in terms of these governors' purported philosophical stance and makes no real sense other than as an act of petulance -- or a hope that implementation goes poorly and they can refuse any responsibility.
Otter's is doing what any conscientious governor, but in some ways particularly a conservative, local control-oriented governor, would do.