States sketch plans for health insurance exchanges

A dozen states have signaled their intentions to move forward with health insurance exchanges, according to the Centers for Medicare & Medicaid Services.

States must provide a summary blueprint for their respective exchanges by Nov. 16. The documents will explain how states intend to operate their online insurance marketplace -- on their own or within a federal-state partnership.

The proactive states include California, Colorado, Massachusetts and Washington, according to a July 11 blog posted by Health & Human Services Secretary Kathleen Sebelius.

On June 28, the Supreme Court upheld most of the Patient Protection and Affordable Care Act, including the creation of the exchanges, where individuals and their families and small businesses may search for, compare and choose affordable health coverage options starting in 2014.

“HHS is committed to flexibility in our support of the states’ progress in whatever route they choose, as well as providing planning and implementation funds to help the states to establish the marketplace that suits their residents’ needs,” Sebelius said. States may build their own exchange, work with other states or partner with the federal government.

The governors of New York and Rhode Island, both of whom sent letters of intent, issued executive orders to begin work on their exchanges. Other governors such as Washington’s Christine Gregoire, were able to initiate the establishment of exchanges through bi-partisan legislation.

In particular, the recently awarded $128 million Level II establishment grant will support the staffing and IT infrastructure necessary to complete the remaining design and development work, and the subsequent operation of the Exchange through December 2014,” Gregoire said in her state letter.

Maryland Gov. Martin O’Malley said that his state-based exchange is “well underway, and we continue to make significant progress with strong support from the state’s political leadership and broad-based stakeholder community.”

Other states that have also submitted letters summarizing their plans include Connecticut, Hawaii, Minnesota, Oregon and Vermont.

The 12 states that are moving ahead of schedule are all led by Democratic governors, except Rhode Island, whose Gov. Lincoln Chafee is an Independent.

States that waited until after the Supreme Court ruled to start thinking about their exchanges will find it challenging to complete their blueprint work by November. Information technology systems that are integral for exchange operations require long lead time to arrange contracts, and legislative sessions for the year are over.

As a result, states who participated in the lawsuit to strike the health reform law may have to rely on the federal government for their exchanges.

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