Federal Officials Gear Up To Operate State Health Insurance Exchanges

The Obama administration is preparing to set up and operate health insurance exchanges required under the Affordable Care Act in more states than it initially expected, the New York Times reports.

When the ACA passed in 2010, President Obama and lawmakers expected that each state would develop its own exchange. However, many Republican-led states have resisted the creation of exchanges or been deterred by the complexity of the project.

Preparations for Exchanges

National Governors Association Executive Director Dan Crippen and Washington and Lee University Professor Timothy Jost both believe that the administration will initially run exchanges in more than half of states, according to the Times. State officials have until Nov. 16 to notify HHS that they will set up their own exchange or have the federal government operate one for them.

Michael Hash, director of the HHS Office of Health Reform and acting director of the Center for Consumer Information and Insurance Oversight, said, "We realize that not all states will be ready to establish these exchanges by 2014, so we are setting up a federally facilitated exchange in those states." He added that the federal exchanges are expected to launch in October 2013, "which is the beginning of the first open season for the individual and small group markets."

The administration has released few details about their plans for the exchanges, such as how the marketplaces will be financed, according to the Times. Hash said the exchanges "will operate essentially in the same manner as the state-based exchanges." However, the Times notes that while states have made their work on establishing their exchanges public, federal officials so far have done work "almost entirely behind closed doors."

Feds Face 'Delicate Political Task'

Federal officials "face a delicate political task" in running the exchanges, the Times reports.

Federal officials must promote the exchanges to encourage U.S. residents to enroll, while being cautious not to "feed fears of a federal takeover or alienate state officials whose help they need," according to the Times (Pear, New York Times, 8/4).