“Everyone thinks that January 2014 is years away,” California HHS Director Kim BelshÃ©Â said. “But 2014 is tomorrow.”
BelshÃ©Â is referring to setting up the California Health Benefit Exchange, now that the governor signed two exchange bills into law yesterday.
The exchange has to be operational three years from its inception, on Jan. 1, 2014 — but that’s the blink of an eye for a project of this scope and importance, BelshÃ©Â said.
“Developing this kind of exchange is going to take some time, and we have got to get on with it,” she said. First, the state has to appoint the 5-person board (with appointees from the governor, Assembly and Senate), and then that board has to hire an executive director. That process alone could take months.
“In order to flip the switch on the exchange, the state will need to test and make sure everything is up and running by the middle of 2013. And the federal government will require readiness by the start of 2014. That’s not that much time.”
California had a health insurance exchange before — the Health Insurance Plan of California, later called PacAdvantage, which stopped running in 2006.
“So we do have the advantage of having had experience with purchasing pools,” BelshÃ©Â said, “so we are in better position to get going on this.”
Millions of Californians will be eligible for federal subsidies to join the exchange, and millions more will be eligible for tax credits.
“All Californians should be interested in joining the exchange, and all Californians can enroll in it. Anyone at 133% to 400% of poverty level — which is up to about $88,000 a year in income for a family of four — are eligible for tax credits. That’s an estimated 2 to 3 million people who are not eligible for subsidies,” but who would benefit through tax breaks, BelshÃ© said.
That large of an enrollment pool could produce huge breaks in premium rates, she said.
“We’re looking at more purchasing clout, and a wider choice of choices,” she said. “And that’s something that can benefit all Californians, whether they’re eligible for a tax credit or not.”
Yesterday was a big day for BelshÃ© , and for California, she said.
“At the end of the day, you’re going have millions more people covered in a strategic and appropriate way, bringing more choice and value to millions of Californians. So yeah,” she said, “I’m pretty happy about that.