The state line thing makes a degree of sense in the context of the (extremely broken) network system. Your insurer has a network of providers with whom they have negotiated rates. If you live far away from your plan’s intended market, you won’t be near the network, and everyone loses except the medical providers who get to overcharge you and your insurer as a result.

It should be quite evident that everything about this system is broken, but this is part of how broken systems get entrenched.