Feds re­leas­ing few de­tails on in­sur­ance ex­changes

Modern Healthcare - - MODERN HEALTHCARE - Rich Daly

Feds re­leas­ing scarce de­tails on ex­changes to be cre­ated for states

Fed­eral health of­fi­cials have re­vealed few de­tails about the de­sign of health in­sur­ance ex­changes that they will es­tab­lish in states that fail to cre­ate their own in­sur­ance mar­ket­places by 2014, de­spite the pos­si­bil­ity that ev­ery state could need a fed­eral ex­change—at least ini­tially— while they com­plete their own.

The 2010 fed­eral health­care over­haul re­quired the cre­ation of fed­eral in­sur­ance ex­changes in ev­ery state that is un­able to cer­tify by Jan. 1, 2013, that it will have within a year a func­tion­ing state ver­sion that meets fed­eral re­quire­ments. Fed­eral of­fi­cials have con­sis­tently said they ex­pect a ma­jor­ity of states to cer­tify and launch ei­ther their own ex­change or a hy­brid fed­eral-state ver­sion. How­ever, se­nior ad­min­is­tra­tion health of­fi­cials re­fused to dis­miss the pos­si­bil­ity that few or no states may meet the deadlines.

Asked about that prospect last week dur­ing a call with re­porters, Steve Larsen, di­rec­tor of the Cen­ter for Con­sumer In­for­ma­tion and In­sur­ance Over­sight at the CMS, said the ma­jor­ity of states are “mov­ing to­ward” de­vel­op­ing their own mar­ket­place. “There are a small num­ber of states that said they want to work with us and in the first in­stance es­tab­lish a part­ner­ship un­der the fed­er­ally fa­cil­i­tated ex­change,” said Larsen, whose agency is re­spon­si­ble for de­vel­op­ing the fed­eral ex­change. “What we hear con­sis­tently from states is that they want to have a state­based ex­change in their state.”

That de­sire is widely echoed by po­lit­i­cal lead­ers and provider ad­vo­cates in var­i­ous states. How­ever, states are now quickly run­ning out of the time they’ll need to not only en­act au­tho­riz­ing leg­is­la­tion but to make suf­fi­cient progress im­ple­ment­ing their ex­changes.

That means many states may need the fed­eral ex­change, Sandy Praeger, chair of the Na­tional As­so­ci­a­tion of In­sur­ance Com­mis­sion­ers’ Health In­sur­ance and Man­aged Care Com­mit­tee, said in an in­ter­view.

“There is time to get them up and run­ning in a state that is run­ning full steam ahead now,” said Praeger, who is also the Kansas in­sur­ance com­mis­sioner. “Not like us, who are dead in the water.”

Even the two states that have func­tion­ing in­sur­ance ex­changes cre­ated by ear­lier state laws—utah and Mas­sachusetts—will need to change those mar­ket­places to meet the stan­dards of the fed­eral law. The changes in­clude ad­min­is­tra­tive over­hauls and pas­sage of at least one “tech­ni­cal” law in Mas­sachusetts, ac­cord­ing to Kait­lyn Ken­ney, di­rec­tor of pol­icy and re­search at that state’s ex­change, called the Health Con­nec­tor.

State po­lit­i­cal lead­ers have been clam­or­ing for de­tails about the de­sign of the fed­eral ex­changes, said Martha Salazar, a pol­icy as­so­ci­ate at the Na­tional Con­fer­ence of State Leg­is­la­tures, be­cause those de­tails may in­form both their own decision to ad­vance cre­ation of a state ex­change, as well as com­po­nents they in­clude in the ex­change.

HHS of­fi­cials have re­vealed lit­tle about the fed­eral ex­change to some state of­fi­cials and much more to oth­ers, ac­cord­ing to Salazar and state health of­fi­cials. Some said HHS has reg­u­larly up­dated them on the few ma­jor ad­vances that have oc­curred in the de­vel­op­ment of the fed­eral ex­change, such as the two con­tracts is­sued to ma­jor fed­eral con­sul­tants since Novem­ber to de­velop com­po­nents of it.

Of­fi­cials at HHS did not respond to re­peated writ­ten re­quests for de­scrip­tions of var­i­ous com­po­nents of the fed­eral ex­changes, and se­nior HHS of­fi­cials sim­i­larly de­clined in-per­son re­quests for de­tails.

HHS did re­cently out­line its ap­proach to defin­ing the es­sen­tial health ben­e­fits, or ba­sic cov­er­age com­po­nents that all health plans in ei­ther state or fed­eral ex­changes will need to in­clude. The guid­ance in­di­cated those ben­e­fits should be based on ex­ist­ing plans in each state. “The es­sen­tial health ben­e­fits bul­letin is an­other sug­ges­tion that HHS and CCIIO are look­ing at a fair amount of flex­i­bil­ity in im­ple­ment­ing” the fed­eral ex­changes, said Molly Collins Offner, di­rec­tor of pol­icy at the Amer­i­can Hospi­tal As­so­ci­a­tion.

State provider groups expressed a range of knowl­edge and in­ter­est in the me­chan­ics of the fed­eral ex­changes.

The hospi­tal as­so­ci­a­tion in Mary­land, one of 10 states to en­act laws cre­at­ing a state-run ex­change, sees lit­tle chance its state will need a fed­eral ex­change, even tem­po­rar­ily. “We fully an­tic­i­pate that this will be a state-run func­tion and that we’ll cer­tainly have that in place and cer­ti­fied by the end of the year,” said Mike Rob­bins, se­nior vice pres­i­dent for fi­nan­cial pol­icy at the Mary­land Hospi­tal As­so­ci­a­tion.

Hos­pi­tals in Texas see lit­tle pos­si­bil­ity state lead­ers would al­low a fed­eral ex­change there, even though the state is among 14 that have nei­ther ap­proved an ex­change nor have ac­tive leg­is­la­tion to cre­ate one. “It’s hard to imag­ine at the end of the day that we would ac­qui­esce and let it be set up from Washington,” said John Hawkins, se­nior vice pres­i­dent of fed­eral re­la­tions for the Texas Hospi­tal As­so­ci­a­tion. Be­cause the Texas Leg­is­la­ture does not meet again un­til 2013, hos­pi­tals are urg­ing Re­pub­li­can Gov. Rick Perry to use his au­thor­ity un­der state law to es­tab­lish an ex­change by ex­ec­u­tive or­der.

States whose ex­change ef­forts fall be­tween ag­gres­sive and nonex­is­tent ap­pear most fo­cused on fed­eral ex­changes.

Neil Eicher, deputy di­rec­tor of gov­ern­ment re­la­tions and pol­icy at the New Jer­sey Hospi­tal As­so­ci­a­tion, said more in­for­ma­tion about the spe­cific com­po­nents of the fed­eral ex­change would help in­form the state’s ef­forts to cre­ate its own ex­change. “We have been get­ting these pieces of in­for­ma­tion but we still don’t know what the final ex­change will look like,” Eicher said.


Ten­nessee Se­nate Speaker Ron Ram­sey says he wants to wait un­til af­ter the Supreme Court rules on re­form and af­ter the pres­i­den­tial elec­tion be­fore tak­ing up leg­is­la­tion on a health in­sur­ance ex­change.

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