Pennsylvania’s own insurance exchange coming next year

HARRISBURG >> Pennsylvania is moving to replace the federally operated Healthcare.gov with its own website to sell Affordable Care Act-compliant policies in a bid to get more people into it and lower their costs.

Gov. Tom Wolf signed legislation July 2 after it passed the Legislature unanimously the previous week. The administration unveiled the legislation in June after lining up support from a wide range of business and consumer advocacy groups, as well as leadership in the Republican-controlled Legislature.

Pennsylvania let the federal government know of its intent and is preparing to submit its plans, called a “blueprint,” in the

coming weeks.

Wolf’s administration expects to take over some of the marketing and outreach efforts for Healthcare.gov next year before it unveils its new website next year for enrollment for the 2021 insurance year.

It says it expects it can lower premiums by 5% to 10% for the 400,000 people who buy policies in the marketplace. Wolf’s insurance commissioner, Jessica Altman, said the savings can especially help the roughly 80,000 people who buy policies through Healthcare.gov, but whose incomes are too high to qualify for a federal tax subsidy.

A state that runs its own exchange gives it more control over it, health care policy analysts say. For example, a state that operates its own exchange can keep automatic re-enrollment, even if the Trump administration ends it in Healthcare.gov policies, thus making it more cumbersome for someone to maintain their policy from year-to-year.

In the meantime, the Trump administration has cut back on the Healthcare. gov marketing budget and funding for navigators, potentially depressing enrollment.

Pennsylvania, however, will take over that role and do it better, Altman said.

“There’s a lot of things that we can do when we have the data and we know about the people who are using this market to do it better,” she said.

It will have information about who is or isn’t enrolling and why, and be able to work with consumer advocacy groups to improve outreach “to make that marketing about Pennsylvania, make it Pennsylvania-grown, Pennsylvania specific, and that’s going to make a difference,” Altman said.

To lower premiums, Wolf’s administration plans to use the savings from taking over the exchange, as well as extra federal reinsurance dollars that states can draw down. The money would reimburse insurers for certain high-cost claims.

Currently, the federal government takes 3.5% of the premium paid on plans sold through the exchange, or an estimated $94 million this year.

The state can operate the exchange for $30 million to $35 million, Wolf’s administration says.

After it qualifies for federal reinsurance funds, the state’s share would be about 20% to one-quarter of the reinsurance program cost, according to Wolf administration estimates.