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Health Exchanges: Can They Be Ready by 2014?

HHS officials say the federal role will be limited to certifying and managing the health care plans offered in the exchanges, although thatís a big task. States will continue their traditional roles in private insurance regulation and enforcement. Plans that are offered in federal exchanges must meet state licensing requirements and be considered in good standing with state insurance officials.

In each state, the federal government will operate a call center and website with a chat function. Call center employees will be trained on the details of insurance plans offered in the state as well as eligibility standards for each stateís Medicaid program and Childrenís Health Insurance Program.

In working with states and in setting up the federal exchange, HHS officials in the last month alone have issued five proposed rules and notices dealing with exchanges, sent three letters to governors and other state officials and posted draft applications for public comment. Earlier this year, the agency issued 11 guidance documents for states as well as three final regulations and held 21 public meetings in 13 states that were open for public comment and questions.

Who will pay for operation of the exchanges?

HHS has distributed more than $2 billion in grant funding to states for planning and establishing exchanges. Once exchanges are up and running, they are supposed to be self-sufficient by Jan. 1, 2015, and raise enough money to pay for their administrative costs. In exchanges run by the federal government, federal officials have proposed imposing a fee on insurers in exchanges to pay those costs. States that will run their own exchanges also could levy user fees; the Massachusetts exchange that serves as a model for the health care law exchanges assesses a fee.

Itís likely these fees will be passed on to consumers in the insurance premiums they pay.

What kinds of benefits will be included in the plans sold on the exchanges?

Any health care plan that is sold through an exchange will have to be a qualified health plan. That means it must meet requirements for a minimum level of value to consumers so it can be compared to other options.

Plans also must include an essential health care benefits package. Each state picks a typical employer plan in its state that serves as a model for that package. There must be coverage in 10 broad categories of health care: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance abuse disorder services; prescription drugs; rehabilitative services and devices; lab services; preventive and wellness services; and pediatric services including dental and vision care.

Whatís next?

More deadlines. By Jan. 1, HHS has to issue approval of any state exchanges that will operate in 2014. On Feb. 15, states that intend to run state-federal partnerships in that first year have to submit their complete applications to HHS. Insurers start handing in applications in April to offer their plans in any of the exchanges. Consumer enrollment starts in October. And on Jan. 1, 2014, all 51 exchanges are to be up and running.

Also, because so many states will use a federal exchange or go with a federal-state partnership, pressure will increase on HHS to supply more details in coming months about how those types of exchanges will be operated.

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