Majority of States Aren't Interested in Setting Up Health Exchanges

A landmark deadline for state decisions on implementing healthcare reform has passed, with Health and Human Services Secretary Kathleen Sebelius marking it on Tuesday by reporting that 24 states and the District of Columbia have signed on to create a health insurance exchange, or marketplace.

That leaves more than half the states -- many of them under Republican governors with strong philosophical objections -- taking no action, which likely will result in the federal government creating a state marketplace on their behalf.

“States will continue to be partners in implementing the health care law, and we are committed to providing them with the flexibility, resources, and time they need to deliver the benefits of the Affordable Care Act to the American people,” Sebelius wrote in a blogpost. “No matter where a qualified consumer lives, he or she will have access to coverage through a Marketplace. And 2014 is the beginning, not the end. States will have the option to apply to run their own marketplace in future years.”

Illinois on Wednesday became the 20th state to have its marketplace proposal conditionally approved, and on Friday, HHS received applications from Michigan, New Hampshire and West Virginia, with more expected by March 1. States whose plans are approved are set to open exchanges on Oct. 1.

“Whether you’re uninsured or just want to explore new options, the marketplace will offer you apples-to-apples comparisons of costs and coverage between health insurance plans,” Sebelius wrote. “You can compare all your insurance options based on price, benefits, quality, and other features that may be important to you, in plain language that makes sense.”

HHS also reported that 37 states plus the District of Columbia have received grants to help them modernize and develop the information technology and business systems needed for their exchange.

On Thursday, at hearing of the Senate Finance Committee, Gary Cohen, a deputy administrator at HHS’ Centers for Medicare and Medicaid Services, assured wary senators that “CMS and our state partners are working hard to ensure that people who do not currently have employer-sponsored health insurance are aware of the new tools that will soon be available for them.” He said HHS is “making great progress” and is “on track.” He said his office is doing outreach on the Internet and through practices previously used to promote the Children’s Health Insurance Program and the Medicare Part D program.

Panel Chairman Sen. Max Baucus, D-Mont., praised HHS for giving states flexibility in designing marketplaces, rather than adopting a “one-size-fits-all solution.” He called on Republicans and Democrats to move beyond past disputes over the 2010 health care law. The Supreme Court largely upheld a constitutional challenge to that law last summer.