HHS awards $1.5B for insurance exchanges

Eleven states have received $1.5 billion more in grants from the Health and Human Services Department to support their creation of health insurance exchanges, which must be ready in October for enrollment season.

Delaware, Iowa, Michigan, Minnesota, North Carolina, and Vermont obtained Level One Exchange Establishment Grants, which are one-year grants that states will use to build their health marketplaces.

California, Kentucky, Massachusetts, New York, and Oregon received Level Two Exchange Establishment Grants, which are multi-year awards to states to further develop their exchanges.

Starting Jan. 1, 2014, Americans in all states will have access to quality, affordable health insurance, and these grants are helping to make that a reality, said HHS Secretary Kathleen Sebelius.

“These states are working to implement the health care law, and we continue to support them as they build new affordable insurance marketplaces,” she said in a Jan. 17 announcement.

[See also: CMS has released proposed rules for health insurance exchanges.]

According to the Patient Protection and Affordable Care Act, the marketplaces are one-stop shops that will provide access to quality, affordable private health insurance choices similar to those offered to members of Congress.

Consumers in every state will be able to buy insurance from qualified health plans directly through these marketplaces, similar to financial and travel websites, and may be eligible for tax credits to help pay for their health insurance. The exchanges aim to promote competition among insurance providers and offer consumers more choices.

A total of 49 states, the District of Columbia, and four territories have received grants to plan their marketplaces, and 34 states and the District of Columbia have received grants to build their exchanges. Only Alaska has not applied for such grants.

[See also: HHS delays deadline for health insurance exchanges.]

According to the Kaiser Family Foundation, HHS has awarded health insurance exchange grants totaling about $2 billion as of the end of fiscal 2012 in September.

To date, HHS has given conditional approval to 20 state-based and partnership model exchanges. Among all the states, 19 have decided to go with a state-based exchange, seven with a federal-state partnership model and 25 have defaulted to a federally-facilitated exchange.