The U.S. Department of Health and Human Services (HHS) issued two Notices of Proposed Rulemaking (NPRMs) on July 11, 2011 relating to state health insurance exchanges. Both NPRMs will be published in the Federal Register on July 15, 2011. Comments on both NPRMs are due by September 26, 2011.
The Patient Protection and Affordable Care Act (PPACA) requires each state to establish by January 2014 an American Health Benefit Exchange and a Small Business Health Options Program (“SHOP”) to facilitate health insurance purchasing by individuals and small employers. Under PPACA, if a state fails to establish an Exchange and/or a SHOP by January 1, 2014, the Secretary of HHS must establish and operate the Exchange and/or SHIP in that state. PPACA provides that each Exchange will: certify health plans that can offer coverage through the Exchange; assign ratings to each plan based on price and quality; provide consumer information on each plan (including an electronic calculator that consumers can use to assess the cost of coverage); determine eligibility for the Exchange, tax credits and cost-sharing programs, public health coverage programs (including Medicare, Medicaid, and CHIP), and exemptions from the individual mandate; and establish a “Navigator” program to assist consumers in making choices about their health care.
The Proposed Rule on the Establishment of Exchanges and Qualified Health Plans NPRM (Exchanges NPRM) includes standards for states that establish Exchanges, insurance plans that participate in Exchanges, employers who participate in SHOPs, and individuals who enroll in health plans through Exchanges. The Exchanges NPRM proposes to allow states flexibility in determining the number and type of health plans that will participate in an Exchange, standards for participating health plans, and the governance structure of an Exchange (e.g., whether the exchange will be run by a new or existing state agency, or a new or existing non-profit entity established by the state).
The Proposed Rule on Standards Related to Reinsurance, Risk Corridors, and Risk Adjustment (Premium Stabilization NPRM) addresses standards related to reinsurance, risk corridors, and risk adjustment to assure stability in the newly established Exchanges. The Premium Stabilization NPRM offers states flexibility in designing these programs, and allows states to operate the reinsurance program even if it does not establish an Exchange.
HHS intends to convene a series of regional meetings at which stakeholders can comment on proposed regulations. More information about the NPRMs, Exchanges, and SHOP is available on Healthcare.gov.