Some question administration’s ability to set up state insurance exchanges

Joel Ario, who until a year ago was the federal official overseeing development of the exchanges, said that while he is optimistic, he isn't certain that the federal government will be ready by October.

"Anybody who tells you for sure . . . is ill-informed, because this is still a work in progress," said Ario, who is now a health-care consultant.

But Michael Hash, director of the office of health reform at the Department of Health and Human Services, said, "We have the contractors in place, and we're on track to meet the deadlines that are necessary to make the exchanges operational."

Under the law, states have three options: They can set up the exchanges themselves, create them in partnership with the federal government or cede control to federal authorities.

The exchanges are fundamental to the law's goal of expanding insurance coverage. Millions of people who aren't covered by employer-sponsored health plans will get federal subsidies to buy insurance through their state's exchange. Those whose incomes aren't low enough for subsidies could still benefit from the competition among insurers that the exchanges are designed to foster.

States that decide to set up their own exchanges must inform the federal government by Friday. So far, about 14 have indicated definite interest, and six more are likely to do so.

States that decline to set up their own exchanges have until Feb. 15 to decide whether to pursue a federal partnership or have Washington take over the entire chore.

At least 13 states have announced their intention to leave the job to the federal government. They include Alabama, where Gov. Robert Bentley (R) became the latest to join those ranks Tuesday.

Experts say the federal government has an interest in persuading as many states as possible to agree, at minimum, to a partnership. That's because the aspects that the states would handle are labor intensive and customized to each state — making them more difficult for federal authorities to deal with. These tasks include deciding which health plans can be sold on the exchanges and monitoring plans' compliance, as well as providing outreach and assistance to consumers.

The latter will require setting up large call centers and walk-in offices, with staff members trained in the minutiae of insurance regulation.

Bruce Caswell, who runs the health-services segment of Maximus — a Reston-based firm that works on large government data systems and is bidding on a federal contract to assist the exchanges — suggested that the government may have to rely heavily on private contractors.

Source: http://www.news.theusalinks.com/2012/11/14/some-question-administrations-ability-to-set-up-state-insurance-exchanges/