March 14, 2012

Government Submits Policy Guidelines For State Insurance Exchanges

As the U.S. Supreme Court gets ready to hear arguments against universal healthcare, the Department of Health and Human Services released policies to assist states to build Affordable Insurance Exchanges. The guidelines offer help for setting standards and setting up a web-based system for consumers to obtain health insurance.

Health insurance is to become mandatory starting in 2014, and states are responsible for setting up one-stop marketplaces for insurance programs to sell to individuals and small businesses. The office of HHS addressed concerns each state may have by setting up policies for establishing Affordable Insurance Exchanges.

Documentation provides standards for establishing Exchanges, setting up a Small Business Health Options Program (SHOP), and a way for each state to perform basic functions of an Exchange, and certifying health plans for participating in the exchange. The guidelines also provide support to establish a streamlined, web-based system for consumers to apply for an enroll in qualified health plans and insurance affordability programs.

"These policies give states the flexibility they need to design an Exchange that works for them," said HHS Secretary Kathleen Sebelius, in a statement. "These new marketplaces will offer Americans one-stop shopping for health insurance, where insurers will compete for your business. More competition will drive down costs and Exchanges will give individuals and small businesses the same purchasing power big businesses have today."

The guidelines are a "final rule" HHS published on Affordable Health Insurance Exchanges, which combines policies from two Notices of Proposed Rulemaking (NPRMs) published last summer. One rule, published July 15, 2011, outlined a proposed framework to enable states to build Affordable Insurance Exchanges created under the Affordable Care Act. A second NPRM, published August 17, 2011, outlined proposed standards for eligibility for enrollement in qualified health plans through the Exchange and insurance affordability programs, including premium tax credits.

By the start of 2014, each state will be responsible for setting up and providing Affordable Health Insurance Exchanges to all of its individual residents and businesses. That is unless the Supreme Court overturns healthcare laws passed under the Obama administration. To date 26 states and a business group have brought a suit to the high court claiming the healthcare reform should be overturned as unconstitutional because it requires most adults to buy private health insurance or pay a penalty, according to a Reuters report.

The Supreme Court will hear oral arguments March 26-28, with a ruling expected in early July.


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