Beginning on October 1, 2013, open enrollment will begin for individuals to purchase healthcare coverage through the Health Insurance Marketplace also called Exchanges. Whether individuals are uninsured, or just want to explore new coverage options, the Exchanges will provide more choice and control over health insurance plans. Individuals will also be able to learn, with a single application, whether they qualify for financial assistance such as the advance premium tax credit that lowers monthly premiums right away.
Consumers in every State will have access to an Exchange, but each State can choose if and how it will operate. In 2014, 17 States will fully run their own insurance Exchange including the District of Columbia. The Department of Health and Human Services (HHS) will fully run the Exchanges in 19 States and in 15 States, HHS will collaborate with the State to run the Exchanges. Given market sensitivities and the fact that plan agreements are not signed until September, HHS will not release State-specific rate information until September when rates are finalized.
These changes will provide consumers with more control and choice over their healthcare options. These new choices include:
- The Exchange is attracting new insurance choices and increasing competition for consumers, especially in States where it is really needed.
- The majority of States will have new health insurance choices that are not available today. The insurance reforms, coupled with premium tax credits, and premium stabilization programs, have made the Exchange an attractive option for new entrants. According to a memorandum from White House officials:
- In about 75% of the States with an HHS-run Exchange, at least one new insurance company intends to enter the market and plans to offer individual market coverage.
- One out of every four insurance companies proposing to offer coverage next year in the HHS-run Exchange has newly entered the individual market.
- About 65% of new issuer entrants to the individual market in the HHS-run Exchange will be in States where only one insurance company dominates the market today.
- Multi-State plans, a program designed to promote additional choices in all States over time, will be offered in at least 31 States nationwide in 2014, with coverage expanding to all 50 States and D.C. no later than 2017. The Office of Personnel Management (OPM) is currently reviewing over 200 proposed Multi-State qualified health plan options. This type of plan offers similar coverage across State lines, and helps promote choice and competition.
HHS, State-run Exchange, and State Departments of Insurance will continue to review applications, including proposed rates, in the coming months. State-run Exchanges like California may post the rates that they have negotiated. In some States where HHS will run the Exchanges, States may post the initial rate filings or approvals prior to September. HHS plans on posting premiums in States where it is running the Exchange when final contracts are signed in September.
Related articles
- Will Obamacare force insurers to compete? The White House thinks so. (washingtonpost.com)
- Health insurers take cautious approach to new exchanges (jsonline.com)
- The Obamacare Shell Game (Part 1) (economicpolicyjournal.com)
- California Regulators Hide Obamacare Rate Shock With Misleading Comparison (reason.com)
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