Now that states have declared their plans for health insurance exchanges, the focus can move from which model to choose -- and its political implications -- to the details of their progress as they prepare for enrollment in October 2013, just 10 months off.
States will need to concentrate more on the practicalities of how they will establish an exchange, whether they are doing it themselves, in partnership with the federal government, or defaulting to a federally facilitated exchange, according to Wade F. Horn, a director with Deloitte Consulting and the health and human services leader for its state government practice.
[See also Half of states go with government HIX.]
“While politics was an important context in which the debate around exchanges was conducted, I think since the election, pragmatics has taken over a number of states, and a decision to go with a federal exchange for some was more about running out of time than it was about politics,” he said.
A number of states that now will defer to a federally facilitated exchange or partnership model, “come six months from now, will start talking about establishing their own state-based insurance exchanges,” he told Government Health IT on Dec. 14.
States are starting to take a hard look at the operational issues and the technology aspects of implementing a health insurance exchange.
No matter how they are designed and built, each state’s exchange will have a website on which individuals and small businesses can compare and obtain health coverage, consumer assistance tools to help them navigate and shop for qualified health plans by quality and price, and systems through which consumers will determine if they qualify for premium tax credits and other supports for affordability.
“I think you will see a second round of states declaring a state-based exchange for the second enrollment period starting Oct. 1, 2014,” said Horn, who is a former assistant secretary for the Administration for Children and Families at the U.S. Health and Human Services Department.
Two more states, Kentucky and New York, and the District of Columbia received conditional approval for their blueprints for their state-based health insurance exchanges on Dec. 14.
That brings to nine the number of state-based exchanges that have received the seal of approval from Health and Human Services Secretary Kathleen Sebelius that they are making steady progress toward readiness for enrollment on Oct. 1, 2013, and operations to follow on Jan. 1, 2014.
Eighteen states plus DC have said that they will build their own exchange, while seven have decided on a partnership model with the federal government. States participating in a partnership exchange must submit their blueprints by Feb. 15, 2013.
The remaining 25 states will opt for a federally-facilitated exchange, according to the latest Kaiser Family Foundation health reform tracker.
States have little experience with health insurance exchanges, and clearly not with the requirements of the Patient Protection and Affordable Care Act. Massachusetts and Utah have had insurance exchanges, but they must perform a gap analysis between their existing exchanges and the ACA requirements.
States that defaulted to the federal exchange can revisit their decision and later establish their own exchange after “taking a year or so to see how it goes and learn from the experience with the federal government and that of other states with their exchanges. It is not an unreasonable approach,” Horn said.
States may assess their own experience working with the federal exchange and that of state-based exchanges performing their own operations. Those states may conclude that working with the federal exchange has been satisfactory and will continue. Or, they may want their own state-based exchange.
Horn also cautioned that just because states intend to establish an exchange by next October, that doesn’t assure their success initially or that this complex technology project won’t have unforeseen hurdles. HHS plans to conduct a series of gate reviews to assess the progress of states building their exchange as they move to the next stage. If states are not making sufficient progress, they would have to come up with other options.
Horn believes the federal government is being as forthcoming and flexible as it can be within the constraints of the law. “They clearly have in mind being a supporter of states as far as possible so that the exchanges can all be successful,” he said.
“The federal government is clearly taking the stance that ‘we want these to work, but if there are going to be issues, we want to know about them early on,’ ” he said.