Healthcare Business News

Deadline arrives for state-run exchange plans

CMS gives conditional nod to Ky., N.Y., D.C.

By Rich Daly
Posted: December 14, 2012 - 2:30 pm ET

Kentucky, New York and Washington, D.C., received conditional approval Friday to run their own health insurance exchanges, which means at least eight states and the nation's capital will launch their own such marketplaces in 2014.

HHS announced conditional approval for six other states—Colorado, Connecticut, Massachusetts, Maryland, Oregon and Washington—this week.

“We will work closely with approved states to ensure they meet deadlines and are ready for open enrollment in October 2013,” Chiquita Brooks-LaSure, director of Coverage Policy Programs, Office of Health Reform at HHS, said in a call with reporters.

The states are among those that previously received federal grants to help fund the development and modernization of the IT systems and business systems needed to operate exchanges.

Friday also was the deadline for states to submit their plans for operating their own exchanges, however, HHS officials refused to release the number that have submitted such plans since states have until midnight to do so. Today's deadline was originally Nov. 16 before a last-minute delay by HHS.

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The Patient Protection and Affordable Care Act, which authorized the exchanges, required the CMS to approve or conditionally approve state-run exchange plans by Jan. 1, 2013, and more will receive such approval, Brooks-LaSure said.

The delayed deadline also gave the states until Feb. 15 to submit plans for operating an exchange in partnership with the federal government.

The eight approved state-run exchanges are among 15 that have applied to do so, said Gary Cohen, director of the Center for Consumer Information and Insurance Oversight at the CMS. Four other states have proposed state partnership exchanges and seven have opted for a federally operated exchange, he said. An additional nine states that Cohen said had submitted letters by Dec. 13 are states with which HHS is still discussing options, according to a congressional source.

At least 18 states plan to run their own exchanges, according to public statements tracked by the Associated Press, while nine plan partnerships and 19 states will default to federal exchanges.

The Congressional Budget Office has estimated that up to 26 million people ultimately will receive coverage through the new exchanges.

Although many Republican state officials have said they did not have enough information or flexibility to launch their own exchanges under the federal healthcare law, federal officials have long said that they preferred states to operate their own exchanges.

“We certainly encourage states to participate as much as they would like and run state-based exchanges because states are at the local level and in the best position to tailor their needs, but we are certainly committed no matter what type of exchange to operate it in a way that is best for consumers and businesses,” Brooks-LaSure said.

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