In the days to come, Senator Betty Boyd and Representative Amy Stephens are to introduce their bi-partisan Health Benefits Exchange Bill. This bill has been highly anticipated and we would love to hear your feedback on it. We will be putting the bill language on the Chapter website once it is formally released. Thank you in advance for any input you may offer!
Health Insurance Exchanges
What are they?
A health insurance marketplace developed with ease of navigation and access, consumer protections and education, and provider transparency in mind. They will help health insurance providers to display their plans, and help consumers to easily compare plans side by side within the online marketplace. Ratings will be available on quality, price, benefits, and services. There will be federal rules on minimum services each plan must contain. This will be a very large pool, innately becoming a mechanism for containing cost.
Exchanges will allow for individuals and small businesses to benefit from risk pooling, market leverage, and economies of scale that large businesses currently enjoy. Every state must have an insurance Exchange up and running by January 1, 2014. Should a state not want to develop its own exchange, the federal government will do so for them.
Why do we need to know about these exchanges?
It is important that we, as the Government Relations Committee, understand the importance of these Exchanges. There will be numerous pieces of legislation that we may need to take a position for or against; at least three already for the state of Colorado specific to Exchanges for the 2011 legislative session have been discussed. To ensure that GRC’s core issues are included, we will need to keep abreast of any and all changes in structure, governance, rules, the strength in which the Exchange will impact the current market, and much more. There are numerous stakeholders involved in the Exchange discussion; consumer advocates, insurance providers, insurance brokers, health care providers, small business owners, etc.
It is very important to mention the role of the state in developing these Exchanges across the nation. The federal guidelines are extremely and intentionally vague. It is the responsibility of each state to take the general federal guidelines (a five-page document) and develop what they see as the best model for their specific constituents. There are two states with up-and-running Exchanges; Utah and Massachusetts. Utah is a very hands-off, low-impact exchange, whereas the Massachusetts Exchange is highly enveloped in the market. California has passed inviting legislation regarding the Exchange’s and Colorado will be posing inviting legislation this winter. There are quite a few competitive grants that will be awarded to the most “on-the-ball” states regarding Exchanges. Colorado has already received an Exchange planning grant in the amount of $1 million.
What are the current perspectives on Health Insurance Exchange(s) in Colorado?
There have been numerous (ten) forums around the state of Colorado. These forums have been attended heavily by folks with varying opinions on the implementation of the Affordable Care Act and on the Exchanges. The following are some key discussion points, and will give you an idea of what the Colorado Exchange(s) may look like.
• Should there be one Exchange or numerous Exchanges in the state?
• Should we allow for regional Exchanges, including other states (and therefore pool risk with constituents from surrounding states)?
• How do we avoid adverse selection- pushing too many folks into or away from the Exchange(s), into or away from the private market?
• Do we allow all providers a place in the Exchange? Do we mandate that all providers participate in the Exchange?
• As it pertains to governance; who can sit on the board? Do we allow for former insurance providers to have a stake in the decision making process? Do we allow for consumers who may not be as ‘in-the-know’ on the board?
• How do we ensure public accountability and transparency?
• How do we ensure that rural constituents and health care providers have access to the Exchange(s)? Many have voiced concern about the Exchange(s) being entirely on-line. What about folks with slow, dial-up lines, or who lack internet access entirely?
The following information is a bit chewy and policy specific, but useful:
Specific Exchange Functions:
Certification, recertification, decertification of plans
Operation of toll-free hotlines
Maintenance of a website for providing information on plans to current and prospective enrollees
Assignment of a price and quality rating to plans
Presentation of a plan benefit options in a standardized format
Provision of information on Medicaid and CHIP eligibility and determination of eligibility for individuals in these programs
Provision of an electronic calculator to determine the actual cost of coverage, taking into account eligibility for premium tax credits and cost sharing reductions
Certification of individuals exempt from the individual responsibility requirement
Establishment of a Navigator program that provides grants to entities assisting consumers as described in Section 1311 (i)
Presentation of enrollee satisfaction survey results
Provision for open enrollment periods
Consultation with stakeholders, including tribes
Publication of data on the Exchange’s administrative costs
For a health plan to be qualified by an Exchange, they must comply with numerous compliance mechanisms that will be policed by the Exchange, according to the Exchange’s oversight responsibilities. Some of these include public disclosure of plan data, to include: claims denials, financial disclosures, cost sharing for out-of-network coverage, accreditation for performance measures, quality improvement and reporting, and uniform enrollment procedures.
*After January 1, 2015, all Exchanges must be fully self-funded.*