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Friday, November 16, 2012

States Health Care Exchange deadline is today

        One of the most significant parts of the Affordable Health Care Act, better known as Obamacare, is the establishment of health care exchanges in each State.  Today is the deadline for States to declare if they will set up the exchange or default to the Federal Government to set up the exchange. The consumer benefits provided by exchanges are:

  • Guaranteed issue: insurers will not be permitted to refuse to insure any individuals
  • Limit to price variations: prices will vary based on four factors and not beyond a total factor of approximately 10
  • Plans will be offered in four comparable tiers ranging from bronze to platinum with limited out of pocket expenses
  • Strict regulations on rescission (dropping insured after issuing coverage)
  • Lifetime and annual limits eliminated

         A number of States were waiting to see the outcome of the Presidential election before making a final decision. A Romney election may have meant that the exchanges in the Act may have been put in limbo.  Now with the President's re-election a reality is that those States will have to scramble if they want to set up the Exchanges in their State.  Some States have already said that they don't plan on setting up the exchanges themselves.  Ironically, but probably not surprisingly, many States with the highest number of uninsured residents have decided not to take on this responsibility.  Texas and Florida, both with Republican Governors, with the number one and number two rankings in the percentage of uninsured residents have both opted out of setting up exchanges.  Other top 10 States in uninsured residents present a mixed picture.  California and Nevada are setting up exchanges.  Montana, Mississippi, New Mexico are studying the issue.  Alaska, Oklahoma and Georgia have not had any activity and will probably opt out.  Generally if the State has a Republican Governor it is far more likely that the State has opted out or has taken no action to set up an exchange.  Making this choice even more stark is the fact that the top eight states with the highest percentage of uninsured residents (Texas, Florida, Nevada, New Mexico, Georgia, Oklahoma, Alaska and Mississippi)  have Republican Governors. The 10 States with the lowest rate of uninsured residents (Massachusetts, Vermont, Hawaii, Minnesota, Wisconsin, Rhode Island, Pennsylvania, Connecticut, Maryland and Maine) all went for President Obama in 2012.  Notice the irony that Massachusetts has the fewest uninsured residents with only 4% of its residents, and no child, uninsured because of Romneycare?
     Maryland has been a leading State in moving ahead to set up a health care exchange.  As the Kaiser Foundation explains,
"On April 12, 2011, Governor Martin O’Malley (D) signed SB 182/HB 166 into law establishing the Maryland Health Benefit Exchange. In May of the following year, Governor O’Malley signed additional exchange legislation (SB 372/HB 433) which addressed multiple exchange implementation and operational issues and was based on recommendations by the Exchange’s Board of Directors and advisory groups from 2011. In August 2012, the state announced that the Exchange would be called the Maryland Health Connection."

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