Insurance Exchanges-Bonnie Washington


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The National Health Council held A Briefing on Essential Health Benefits on August 3, 2011. This slide show was the luncheon presentation explaining state health exchanges.

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  • HHS issued two notices of proposed rulemaking on July 11, 2011. Comments are due for both rules on September 28, 2011:Establishment of Exchanges and Qualified Health Plans Standards Related to Reinsurance, Risk Corridors and Risk AdjustmentHHS must determine whether a state will operate an exchange by January 1, 2013The rule gives states additional flexibility to meet this deadline by granting “conditional approval” to states that likely will be ready for implementation by 2014, but cannot yet be certified as ready on January 1, 2013In order to receive approval from HHS, the state must submit a detailed exchange plan and demonstrate operational readiness
  • WV – plan rep elected by majority vote among 10 top plans by enrollment
  • Insurance Exchanges-Bonnie Washington

    1. 1. Insurance Exchanges /Federal Regulations & State Flexibility<br />August 3, 2011<br />Bonnie Washington<br />Avalere Health LLC<br />
    2. 2. States Have Substantial Implementation Responsibilities in the Next 3 Years<br />Federal Activities<br />Deadline for Approval or Conditional Approval of State Exchange Plan<br />January 1, 2013<br />Proposed Exchange Rule Released<br />July 2011<br />Final Exchange Rule Expected<br />Late 2011<br />Affordable Care Act Passed<br />March 23, 2010<br />Exchanges Begin<br />2014<br /> 2010 2011 2012 2013 2014 <br />State Activities<br />Pursue Legislation or Executive Order to Implement an Exchange<br />File Exchange Plan<br />Establish Governing Boards<br />Operational Planning & Implementation<br />Open Enrollment<br />Plan Bids Submitted<br />
    3. 3. States Are Busy Implementing Exchanges As the Federal Government Issues Regulations<br />WA<br />ME<br />MT<br />ND<br />VT<br />NH<br />MN<br />OR<br />MA<br />WI<br />NY<br />ID<br />RI<br />SD<br />CT<br />MI<br />WY<br />PA<br />NJ<br />IA<br />NE<br />DE<br />OH<br />NV<br />IN<br />IL<br />MD<br />WV<br />UT<br />VA<br />D.C.<br />CA<br />CO<br />MO<br />KY<br />KS<br />NC<br />TN<br />OK<br />SC<br />AZ<br />AR<br />Adopted Establishing Legislation (11)<br />NM<br />GA<br />AL<br />MS<br />Exchange in Operation (2)<br />LA<br />TX<br />AK<br />Adopted Legislation Requiring New Study (3)<br />FL<br />Issued Executive Order Requiring New Study (6)<br />HI <br />In Progress (28)<br />Source: Avalere Health Reform State Insights, July 15, 2011.<br />
    4. 4. Proposed Exchange Regulation Grants States Significant Flexibility to Establish Exchanges<br />
    5. 5. Governance Structure and Composition<br />Federal Requirements<br /><ul><li>Exchange governing bodies may be housed within government agencies or as freestanding non-profit entities (or a combination of both)
    6. 6. At least half of all voting board members must represent consumer interests</li></ul>10-person board in the Department of the Insurance Commissioner<br />Includes consumer and employer representation, plus one plan rep<br />WV<br />WV<br />CA<br />Government-Run<br />Independent<br />5-person independent, quasi-governmental board<br />Includes appointed members that may not represent health plans or providers<br />
    7. 7. WA<br />ME<br />MT<br />ND<br />VT<br />NH<br />MN<br />OR<br />MA<br />WI<br />NY<br />ID<br />RI<br />SD<br />CT<br />MI<br />WY<br />PA<br />NJ<br />IA<br />NE<br />DE<br />OH<br />NV<br />IN<br />IL<br />MD<br />WV<br />UT<br />VA<br />D.C.<br />CA<br />CO<br />MO<br />KY<br />KS<br />NC<br />TN<br />OK<br />SC<br />AZ<br />AR<br />NM<br />GA<br />AL<br />MS<br />LA<br />TX<br />AK<br />FL<br />HI <br />Presence of Benefit Mandates Varies Significantly By State<br />Number of Mandates <br />< 15<br />16 - 30<br />31 - 45<br />46 – 60<br />> 60<br />1.Source: Council for Affordable Health insurance,<br />
    8. 8. Health Plan Bidding Process<br />Federal Requirements<br /><ul><li>Give exchanges discretion on plan contracting, including accepting any qualified plan, conducting competitive bidding, or conducting case-by-case negotiations
    9. 9. States may set additional requirements for participating plans</li></ul>UT<br />The state’s exchange accepts all health plans licensed to offer coverage in the state<br />WV<br />Passive Facilitator<br />Active Purchaser<br />Requires plans to adhere to specific benefit designs, excluding those that do not compare favorably<br />MA<br />
    10. 10. Small Business Health Options Program (SHOP) <br />Federal Requirements<br /><ul><li>States integrate SHOP with individual exchange or administer them separately
    11. 11. Includes groups up to 100 employees—states may include larger employers or limit to <50
    12. 12. Exchanges must offer employee choice—states and employers may limit plan options or offer extra flexibility to choose between tiers</li></ul>Separate exchanges; SHOP limited to groups <50<br />Minimum requirements for employee choice<br />WV<br />Limited Market, Less Flexibility<br />Large Market, Broad Flexibility<br />Integrated exchanges; SHOP eligibility expanded to large groups<br />Broad employee choice options for employers<br />
    13. 13. Other State Flexibility in Exchange Implementation<br />*Employee choice means that employers select a benefit tier (e.g., silver) and employees can enroll in any plan in the tier (e.g., Aetna or Blue Cross Blue Shield)<br />
    14. 14. Separate Rulemaking Will Address Additional Exchange Related Topics<br />Detailed requirements on the federal fall-back exchange that will operate in states that fail to establish an exchange will likely be covered in subregulatory guidance<br />