Last week, U.S. Health and Human Services (HHS) Secretary Kathleen Sebelius assured yet another congressional panel that the Patient Protection and Affordable Care Act (PPACA) exchanges will be opening on schedule.
"We are moving ahead," Sebelius stated April 18th at a House Energy & Commerce health subcommittee hearing on the HHS fiscal year 2014 budget request. "We are definitely going to be open for open enrollment starting Oct. 1 of 2013."
State Health Insurance Exchange (HIX) programs are mandated under PPACA to provide competitive marketplaces in which individuals and small businesses can choose among private insurance plans; it is meant to be a “one-stop shopping” experience. The HIX programs also are designed to assess individual financial need and determine federal compensation. Health insurance plans offered in the insurance exchanges must reach certain levels of coverage and include PPACA-mandated options that other private, grandfathered health plans may be exempt from.
HIX programs can be set up in a few different ways. First, states can run their own HIX programs; if so, they are eligible to receive federal grants. States had until December 14, 2012 to submit plans for state-run HIX programs to HHS for approval. Second, states can run HIX programs in conjunction with the federal government; plans for such programs had to be submitted to HHS by February 15, 2013. Third, all states who either chose not to submit plans for health insurance exchanges or whose plans were not approved will have programs set up and run by HHS. All HIX programs are meant to be fully operational by January 1, 2014; states that have declined responsibility or partnership can still choose to implement state HIX programs past that date.
While implementation of the HIX programs may still be on schedule, exchanges will not be giving small businesses a full choice of plans in 2014. At the April 18th subcommittee hearing, Sebelius explained that HHS has decided to let the Small Business Health Options Program (SHOP) small-group exchanges put off giving employers a chance to offer employees a multi-carrier coverage option.
Each SHOP exchange will still offer the employers themselves a chance to choose from a menu that includes plans from all of the carriers that have agreed to sell plans through that exchange, Sebelius said.
Will the new health exchanges open on time, as Ms. Sebelius assured us last week? We’ll all know for sure later this year; and by this time next year we’ll have a better idea whether these exchanges ultimately will be a success or a failure.
Until next time,
Andrew Herman, President
AH Insurance Services, Inc.