State of the States: Health Insurance Exchanges

June 15, 2012

This Week in the States: With policymakers, politicians and other exchange watchers eagerly waiting for the Supreme Court’s ruling, which some believe could come as early as next week, it was a slow week for exchanges. Let’s focus on the few things that happened.

This week, Hawaii became the first state to formally declare its intent to create a state-based insurance exchange and seek federal approval for the Hawaii Health Connector. In a “declaration letter” sent earlier this month from Governor Neil Abercrombie (D) to the U.S. Health and Human Services Center for Consumer Information and Insurance Oversight, Gov. Abercrombie formally stated that it was Hawaii’s goal to work “collaboratively in order to ultimately obtain approval for [a] state-based exchange and to ensure the Connector’s operational readiness for 2014.” The formal declaration letter submitted by Gov. Abercrombie is the first step of a two-part “Exchange Blueprint” that all states need to submit to HHS by November 16, 2012. According to CCIIO regulations, Hawaii still needs to submit an “application describing readiness to perform Exchange activities and functions.”

Still focusing on our nation’s governors, on Wednesday, Governor Robert Bentley (AL-R) shed a few more insights into how Alabama may respond to the Supreme Court’s ruling on the ACA. Previously, Gov. Bentley had notified lawmakers that he would veto any exchange-enabling legislation sent to him before the Supreme Court handed down its ruling. However, he also stated that if the ACA is upheld, he will establish an exchange by Executive Order. In his most recent comments, Gov. Bentley said that he might create a health insurance exchange by Executive Order within an existing state agency. Currently, most exchange planning in Alabama is being conducted by the Alabama Department of Insurance, which is preparing to host a June 20 webinar covering the analysis done to date assessing benefits offered in allowable essential health benefit benchmark plans and additional options for pediatric dental and vision benefits. Interested parties can sign up here.

Also on Wednesday, the Rhode Island legislature sent H7909 to Governor Lincoln Chafee (I), which amends Rhode Island laws to comply with some of the insurance market reforms included in the ACA. While Gov. Chafee had previously used an Executive Order to create a health insurance exchange, the Order did not have the authority to bring various laws into compliance with the ACA. A summary of the legislation prepared by the Rhode Island Office of the Health Insurance Commissioner is available online.

Finally, the Small Business Majority released the results of a poll it conducted with 800 small business owners in Florida, Illinois, Louisiana, Michigan, Missouri, New York, Texas and Virginia. The survey found that 66 percent of small-business owners were interested in using a health insurance exchange to provide insurance for their employees. The survey also found that employers were most interested in using the SHOP to offer dental and vision insurance in addition to medical plans that incorporated wellness programs. There was also high interest in a defined contribution, employee choice model, wherein employers contribute a flat amount toward employee health insurance and let employees pick a plan that best fits their needs.

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