Exchange Deadline Extended

Originally, states were to submit their “blueprints” by November 16.

In acknowledging the fact that many governors and legislatures across the nation delayed planning until after the presidential election, the Obama administration will extend the deadline by which states must submit the initial framework of their health insurance exchanges.

While this Friday remains the deadline by which all states must tell federal regulators how they plan to proceed, ultimately states have until Dec. 14 to submit plans for the state-based online markets, according to a letter from HHS Secretary Kathleen Sebelius. What’s more, states wanting to partner with the federal government on this venture will have an additional two months…until Feb. 15.

The exchanges are a key element of Healthcare Reform. The provision reflects dual intentions: to make it easier to find an affordable plan, and to help people determine whether they qualify for new federal subsidies. It’s estimated that between 12-25 million people will obtain coverage through the exchanges starting in 2014. Under the law, the federal government will set up exchanges if states don’t.

Back in August, HHS issued a “blueprint” for the approval of state-based and state-partnership insurance exchanges. It grants states three implementation options:

  1. A state-based exchange, wherein the state operates all exchange activities (but may partner with the federal government regarding the premium tax credit, etc.);
  2. A state partnership exchange, wherein the state’s primary role is limited to plan management, consumer assistance, etc.; or
  3. A federally-facilitated exchange wherein the federal government runs everything.

Along with a declaration letter, state submissions must include an exchange application which requires completion or progress in 13 different categories.

HHS will approve a state-based exchange once the state has demonstrated the ability to satisfactorily perform all required exchange activities. “Conditional” approval will be granted to a state-based exchange that does not meet all requirements but is making significant progress and intends to be operationally ready for the initial open enrollment period (beginning on Oct. 1, 2013). To be operationally ready, a state must be able to provide consumer support for coverage decisions, facilitate eligible determinations for individuals, provide enrollment in Qualified Health Plans (QHPs), certify health plans as QHPs, and operate a Small Business Health Options Program (SHOP) exchange.

For a current look at where the 50 states (and the District of Columbia) stand on the creation of health insurance exchanges, click here.  


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