HHS To Waive, Extend Deadline for Health Insurance Exchanges

HHS Secretary Kathleen Sebelius has announced she will extend or waive the deadline for states interested in running their own health insurance exchange or partnering with the federal government, the New York Times reports.

Under the Affordable Care Act, Sebelius was directed to determine "on or before Jan. 1, 2013," whether states were prepared to run their own exchanges. However, instead of determining now whether the exchanges are ready, HHS will work with states and set timelines and goals to progress toward creating an exchange, according to the Times.

Gary Cohen, director of the federal Center for Consumer Information and Insurance Oversight, said, "There is no deadline," adding, "We are going to give final approval once states demonstrate that they are able to satisfy all the requirements and meet all the conditions of operating an exchange."

Federal officials also are giving states that want to partner with the federal government extra time, "to some degree," according to the Times. Sebelius said that states still have until Feb. 15 to file applications to operate exchanges "in partnership with the federal government."

The Obama administration hopes the decision will help boost participation rates among the states that have declined to run their own exchanges. Federal officials said they were trying to persuade non-participating states to share the work of running an exchange, supervising health plans and assisting consumers.

According to the Times, the extension will give states more time to come into compliance with the ACA, after the White House found many states are lagging behind in establishing their exchanges. For example, HHS granted Idaho conditional approval for a state-run exchange, but Gov. C. L. Otter (R) has yet to get approval from a Republican-controlled state Legislature. In addition, Utah -- another state granted conditional approval -- noted in its application to HHS that it was hesitant about enforcing certain parts of the ACA, such as the individual mandate (Pear, New York Times, 1/14).

Currently, 18 states and the District of Columbia have received federal approval to run their own exchanges, while two states have been approved for partnerships with the federal government (California Healthline, 1/4).