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States Health Insurance Exchanges Are Shaking Out

The Council of State Governments

CAPITOL EEch

health

ThE counc oF TTE govEnEnT

The last deadline for states to decide just how much

they are going to be involved in operating health in-

surance exchanges passed on Feb. 15, 2013. That was

the last day for governors to send letters to the U.S.

Department of Health and Human Services declaring

that their state would work in partnership with thefederal government.

Under a partnership arrangement, states might

oversee the selection and management of health

plans available in the exchange marketplace. The fed-

eral government would have primary responsibility

to manage the marketplace website and call centers,

to accept applications and to determine eligibility for

federal tax subsidies.

Seven states will operate an exchange in partnership with

the U.S. Department of Health and Human Services. Governors in New Hampshire and West Virginia

submitted letters Feb. 13 and 15, respectively,

declaring their intentions to operate health insur-

ance exchanges in partnership with the federal

government. Federal approval is pending.

Five other statesArkansas, Delaware, Illi-

nois, Iowa and Michiganpreviously submitted

proposals to operate a joint exchange. Federal

approval is pending for Iowa and Michigan.

Seventeen states and the District of Columbia are moving

forward with plans for state-based exchanges. The federal

government has conditionally approved all of them. The

states operating their own exchanges are concentrated in

the Northeast and West. California, Colorado, Connecticut, Hawaii, Idaho,

Kentucky, Maryland, Massachusetts, Minnesota,

Nevada, New Mexico, New York, Oregon, Rhode

Island, Utah, Vermont and Washington will oper-

ate state exchanges.

Massachusetts and Utah already had state health

insurance exchanges established by legislation

before Congress passed the Affordable Care Act

in March 2010. Ten states approved legislation to

operate the exchange in the 2011 or 2012 legisla-

tive sessions.

Three statesKentucky, New York and Rhode Is-

landestablished the exchanges by executive order.

State legislation to establish state exchanges is

still pending in Idaho and Minnesota.

Mississippi is the only state whose plan for a

state-based exchange failed to garner federal

approval because it was submitted by the states

insurance commissioner and not endorsed by the

governor.

The remaining 26 states have deferred to the federal

governments operation of health insurance exchanges. The states that have opted out of state-based ex-

changes include many whose governors have beenoutspoken opponents of the Affordable Care Act

since it passed and who joined the federal lawsuit

seeking to overturn the law.

The states that have opted out of operating ex-

changes include many in the Midwest and South.

Regardless of the administration of the state health

insurance exchanges, two major deadlines established by

the Aordable Care Act loom. The exchanges must begin open enrollment for

individuals and small group health insurance poli-

cies on Oct. 1, 2013.

7/29/2019 States Health Insurance Exchanges Are Shaking Out

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Policy coverage begins Jan. 1, 2014.

Individuals qualify for federal tax subsidies only

by purchasing insurance through the exchanges.

Those subsidies are intended to make health

insurance affordable for those people with in-

comes between 100 and 400 percent of the federal

poverty level.

People who apply to state exchanges for insur-

ance and who are income-eligible for Medicaid

will be seamlessly enrolled in Medicaid. Coopera-

tion will be required between the exchange, no

matter the administrative authority, and states

Medicaid programs. In those states that adopt the

Affordable Care Act option to expand eligibil-

ity to 138 percent of poverty, the exchanges are

likely to encounter a number of Medicaid eligible

applicants.

States decisions on exchanges need not be per-

manent. Federal guidance provides that states can

apply by Nov. 18, 2013, to take more state control

in 2015 or by Nov. 18, 2014, to make a change for

2016. 1October 16, 2012 correspondence from Gov. Pat Quinn to Acting Director Gary Cohen, Centers forMedicare & Medicaid Services. Accessed Feb. 25, 2013 at

http://cciio.cms.gov/Archive/Technical-Implementation-Letters/il-exchange-letter.pdf .

RSORCS

Debra Miller, CSGs Director of Health Policy | dmiller@csg.org

In his letter declaring Illinois intention to partner

in the exchange, Gov. Pat Quinn said, I am

committed to working with the Illinois General

Assembly to pass legislation with governance and

nancing language that will allow us to operate a

state-based exchange beginning in 2015.1

Hospitals and health insurance companies will

likely continue to lobby for states to take more

control of their exchanges. Both health care sec-

tors have been outspoken proponents of state-

based exchanges, advocating that states are in the

best position to run exchanges because of their

experience with local markets and insurers and

their proximity to individual and business pur-

chasers of health insurance.

mailto:dmiller%40csg.org?subject=mailto:dmiller%40csg.org?subject=

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Status o State Health Insurance Exchanges Required Under the Afordable Care Act

State Decision on exchange

operation

Status o Federal

Approval, 2/25/2013

State Autho rity or Excha nge Structure o Exchange Exchange Name and Website

labama Defer to federal operation

laska Defer to federal operation

riza Defer to federal operation

rkasas S tat e fed era l p ar tn ers hi p Co nd it ion al a pp ro val G ov. d ec lar at ion l et ter ( 20 12)

califria State run Conditional approval State legislation, SB 900, AB 1602(2010)

Quasi-governmental Covered California

clrad State run Conditional approval State legislation, SB 200 (2011) Quasi-governmental Connect for Health Colorado

cetit State run Conditional approvalState legislation, SB 921; Public Act.

No 11-53Quasi-governmental Access Health CT

Distrit f clmbia State run Conditional approval Legislation/resolution, B19-0002 (2012) Quasi-governmentalDistrict of Columbia Health Care

Exchange

Delaware S tat e fed era l p ar tn ers hi p Co nd it ion al a pp ro val G ov. d ec lar at ion l et ter ( 20 12)

Flrida Defer to federal operation

geria Defer to federal operation

hawaii State run Conditional approval State legislation, SB 1348 (2011) Non-prot Hawaii Health Connector

da State run Conditional approval State legislation pending (2013)

lliis S tat e fed era l p ar tn ers hi p Co nd it ion al a pp ro val G ov. d ec lar at ion l et ter ( 20 12)

diaa Defer to federal operation

wa S tat e fed era l p ar tn ers hi p Pend in g G ov. d ec lar at ion l et ter ( 20 12)

Kasas Defer to federal operation

Ketky State run Conditional approval Executive order, 2012-587 Operated by the state Kentucky Health Benet Exchange

isiaa Defer to federal operation

aie Defer to federal operation

arylad State run Conditional approval State legislation, SB 182 (2011) Quasi-governmental Maryland Health Connection

assasetts State run Conditional approvalState legislation, Chapter 58 of Acts

2006Quasi-governmental

Commonwealth Health Insurance

Connector Authority

iia S tat e fed era l p ar tn ers hi p Pend in g G ov. d ec lar at ion l et ter ( 20 13)

iesta State run Conditional approval Legislation pending (2013) Minnesota Health Benet Exchange

ississippi Defer to federal operation

issri Defer to federal operation

taa Defer to federal operation

nebraska Defer to federal operation

neada State run Conditional approval State legislation, SB 440 (2011) Quasi-governmental Silver State Health Insurance Exchange

new hampsire S tat e fed era l p ar tn ers hi p Pend in g G ov. d ec lar at ion l et ter ( 20 13)new Jersey Defer to federal operation

new exi State run Conditional approval Gov. declaration letter (2012) Quasi-governmentalNew Mexico Health Exchange

Information

new Yrk State run Conditional approval Executive order, #42 (2012) Operated by the state The New York Health Benet Exchange

nrt carlia Defer to federal operation

nrt Dakta Defer to federal operation

oi Defer to federal operation

oklama Defer to federal operation

ore State run Conditional approval State legislation, SB 99 (2011) Quasi-governmental Cover Oregon

Pesylaia Defer to federal operation

de slad State run Conditional approval Executive Order, 11-09 Operated by the state Rhode Island Health Benet Exchange

t carlia Defer to federal operation

t Dakta Defer to federal operation

Teessee Defer to federal operationTexas Defer to federal operation

uta State run Conditional approvalState legislation, HB 188 (2009), HB 133

(2008) (b)Operated by the state Avenue H

vermt State run Conditional approvalState legislation, Public Act No. 48

(2011)Operated by the state Vermont Health Connect

viriia Defer to federal operation

Wasit State run Conditional approval State legislation, SB 5445 (2011) Quasi-governmental Washington Heatlhplannder

West viriia S tat e fed era l p ar tn ers hi p Pend in g G ov. d ec lar at ion l et ter ( 20 13)

Wissi Defer to federal operation

Wymi Defer to federal operation

Notes:(a)Massachusetts already had an exchange for individuals and small groups, 1 to 50 employees. (b)tah already had an exchange f or the small group market, 2 to 50 employees.Sources: CSG research; The Commonwealth Fund http://www.commonwealthfund.org/Maps-and-Data/State-Exchange-Map.aspx; Kaiser State Health Facts,http://www.statehealthfacts.org/comparemaptable.jsp?ind=962&cat=17; .S. Department of Health and Human Services, http://cciio.cms.gov/archive/technical-implementation-letters/index.html

http://www.commonwealthfund.org/Maps-and-Data/State-Exchange-Map.aspxhttp://www.statehealthfacts.org/comparemaptable.jsp?ind=962&cat=17http://www.statehealthfacts.org/comparemaptable.jsp?ind=962&cat=17http://cciio.cms.gov/archive/technical-implementation-letters/index.htmlhttp://cciio.cms.gov/archive/technical-implementation-letters/index.htmlhttp://www.statehealthfacts.org/comparemaptable.jsp?ind=962&cat=17http://www.commonwealthfund.org/Maps-and-Data/State-Exchange-Map.aspx