The document outlines a proposal for expanding health insurance coverage for Utah's uninsured citizens, comprising 11.9% of the population, with a focus on young adults and those in small businesses. It details the establishment of the Utah Health Insurance Exchange as a mechanism to facilitate private health plan purchases while promoting personal responsibility and providing public subsidies. The exchange aims to simplify insurance access for individuals and employers, enhance competition among insurers, and ultimately reduce the uninsured rate in Utah.

1. Expanding Health Insurance
Coverage for Utah’s Uninsured
Citizens
The Utah Health Insurance
Exchange
8/15/2007

2. Who are the 11.9%?
iCurrently Uninsured (11.9%) 306,500
By Age:
-Children, Under 19 years old 89,500
-Young Adults, 19 to 34 years old 140,200
-Adults, 35 years old or older 76,800
-Note: Figures in these categories do not sum to the total
because of missing values on the grouping variable.
By Employment Status:
-Adults, 19-64 with Full-time jobs (35%) 107,600
-Adults, 19-64 with Part-time jobs (13%) 39,300
-Adults, 19-64 who are Self-employed (12%) 36,200
8/15/2007

3. Key Factors – The Young Immortals
i75% of the 11% (229,000) are under age 34
i68% of uninsured adults (147,000) have jobs
iAround 70% of uninsured workers work for small business
iThere are also many uninsured who are dependents of people
with jobs
iThere are around 25,000 uninsured full-time college students
iThe Young Immortals are the primary group of free riders in
the health care system
8/15/2007

4. Organizing Principles for Insuring Everyone
iGive needed attention to the small group market
iReverse the trend of businesses discontinuing insurance
benefits
iIntroduce competition and individual choice
iInsure people while they are young and healthy
iCreate an Exchange to facilitate the purchase of
insurance with pre-tax dollars where possible
iFacilitate purchase of insurance by part-time workers
and workers with more than one job
iCreate a social attitude of insurance and personal
responsibility
8/15/2007

5. Goals
iMake it easier and more appealing for
Utah’s individuals and families to
purchase health insurance
iGive employers another tool to provide
valuable benefits to Utah’s workers
iIncreased the number of insured Utahns
& decrease the uninsured population
iPromote a culture of insurance and
personal responsibility
8/15/2007

6. Description of the Exchange
iIt is a mechanism to facilitate purchase
iLegal structure to coordinate
-Workers using pre-tax income
-Employer contributions
-Federal and state subsidies
iThe Exchange is a state-chartered not-for-
profit corporation
iThe Exchange is not government-sponsored
insurance
iThe Exchange is not a risk pool
iThe Exchange is not a regulator
8/15/2007

7. Stock Exchange vs. Insurance Exchange
Individual Individual
Investor Consumer
Investment
Broker/Agent
Firm
Securities Utah
Exchange Department
Commission of Insurance
New York Utah
Stock Health Insurance
Exchange Exchange
Publicly Traded Insurance
Companies Carriers
8/15/2007

8. Insuring Individuals and Employees of
Small Business
Utah Health
Insurance
Exchange
Choice of Private The Utah Insurance Exchange is a
Health Plan clearinghouse for private health plans.
Working
• Employers offer a pre-tax health plan to
Families
all employees
Pre-tax Premiums • Allows employers to use a defined
contribution system
Private • Working families choose plans to meet
Health their needs
Defined contribution Employers • Health insurance premiums are tax free
Plans (pre-tax)
• Health insurance becomes portable and
flexible
Subsidy for UPP
qualifying families
8/15/2007

9. The Functions of the Exchange
iApprove private health insurance
products for inclusion
iFacilitate enrollment and choice
iCollect and consolidate payments
iSend funds to insurance companies
8/15/2007

10. Benefits for Employees
iEmployees elect to participate
iCan select any offered plan for
themselves and their family
iInformation on cost and coverage
comparisons
iPre-tax withholding
iPortable and flexible coverage
8/15/2007

11. Benefits for Employers
iChoose to designate the Exchange as
their group health plan – simplifies
administration
iNo need to research, negotiate, or
designate one option for all workers
iVoluntary contribution amounts
iContributions from multiple employers
can be pooled
8/15/2007

12. Public Subsidies
iQualifying workers can apply for
subsidies
iThe Utah Premium Partnership for Health
Insurance (UPP)
iPublic dollars reduce employees’ share of
premiums
8/15/2007

13. Employer Obligations
iEmployers might still offer current group
plans
iAt a minimum, employers must make
the Exchange available by:
-Setting up a Section 125 plan
-Collecting premiums
-Submitting premiums to the Exchange
iContribution requirement?
8/15/2007

14. Insurance Market Impact
iThe Exchange would be the only marketplace
for individual and family policies
iThe Exchange could become the sole
marketplace for small group plans
iInsurers compete for business by offering
appealing policies
iExchange requirements would prevent niche
products and cherry-picking – all insurers
would have to offer an “essential benefit” plan
8/15/2007

15. Risk Sharing in the Exchange
iSome mechanism is needed to address
uninsurable individuals
iVarious options will be explored:
-Community rating
-Rating bands
-Rate regulation
-Reinsurance
-HIP Utah
8/15/2007

16. The Role of Brokers/Agents in the Exchange
iLicensed and trained producers provide a
valuable service
iAdvice and counseling on plan selection
iEnrollment of individuals and groups
iReceive a commission for services
rendered
iAdjust services provided in a changing
marketplace
8/15/2007

17. Advantages of the Exchange Model
iAffordability (Tax Savings)
iCombining Resources
iSimplified Process
iPrivate Solution
iFlexibility and Choice
iPortability
iPromotes Shift to Defined Contribution
iMechanism for Reaching Non-Traditional
Workers
8/15/2007

18. Individual Responsibility
iRequiring everyone to be insured
iPros
-Eliminates cost-shifting of the uninsured
-Eliminates risk-selection issues
iCons
-How do you enforce an individual mandate?
-How do you ensure an affordable product is
available?
8/15/2007