The Department of Health and Human Services has awarded nearly $49 million to help 48 states and the District of Columbia plan for health insurance exchanges, including assessing existing information technology systems and infrastructure. However, not all states are eager to take the funds.
Alaska and Minnesota have turned down the grants. Minnesota Gov. Tim Pawlenty, said Oct. 8 during his radio show Good Morning Minnesota, that such exchanges would not “really make healthcare more affordable.”
He took issue with "these exchanges – where the government will direct how and when you buy your insurance if you're an individual or small businessperson,” Pawlenty said, “the government will determine what your benefit sets look like. The government will manage it and administrate it, either directly or indirectly."
Alaska turned down the funds because it is involved in a 20-state lawsuit over the reform law's individual mandate, according to Politico's "Pulse,” which quoted Alaska Insurance Director Linda Hall as saying, "Alaska is part of the suit against the federal government to stop the [individual] mandate as we think it’s unconstitutional. And thus, we are not going to take federal money to create a vehicle to implement that exchange."
California took a different tack. It became the first in the nation to establish an exchange, creating the Health Benefit Exchange, which Gov. Arnold Schwarzenegger described in an Oct. 1 speech as “essentially a giant purchasing pool for health insurance.”
“This exchange will allow consumers and small businesses to research, compare and purchase health insurance products that best fit their needs,” he said.
Blue Shield of California chairman, president and CEO Bruce Bodaken joined Schwarzenegger at the Oct. 1 ceremonial bill signing. “Given the strong opposition to this legislation by some, it may seem surprising that a health plan CEO would stand up to support it. But at Blue Shield, we have long believed that establishing a strong exchange is critical to fixing a broken insurance system,” Bodaken said.
The health insurance exchanges – competitive, consumer-centered private health insurance marketplaces – are called for in the Affordable Care Act. They are aimed at giving individuals and small businesses greater control and more choices.
The grants of up to $1 million each will give states the resources they need for:
Assessing current information technology systems and infrastructure and determining new requirements
Developing partnerships with community organizations to gain public input into the exchange planning process
Planning for consumer call centers to answer questions from their residents
Determining the statutory rules needed to build the exchanges
Hiring key staff and determining ongoing staffing needs
Planning the coordination of eligibility and enrollment systems across Medicaid, the Children's Health Insurance Program (CHIP), and the exchanges
Developing performance metrics, milestones and ongoing evaluation
"Today, too many individuals and small businesses are on their own in dealing with insurance companies," said HHS Secretary Kathleen Sebelius when she made the announcement on Sept. 30. "They pay higher costs than Americans who get their insurance through big companies or other large employers because they can't pool their costs or spread the risk."
Sebelius said the grants would help states create exchanges, so individuals and small businesses can band together, have the same purchasing power as big employers, and get a fairer deal.
The state-based exchanges will make purchasing health insurance easier by providing eligible consumers and businesses with "one-stop-shopping" where they can compare and purchase health insurance coverage. Americans will have the same health care choices as members of Congress – who will also purchase coverage through the exchanges. Individuals and families purchasing health insurance through exchanges may also qualify for tax credits and reduced cost-sharing depending on their income.
