On March 12, 2012, the Department of Health and Human Services (HHS) published a final rule on Affordable Health Insurance Exchanges (Exchanges), which are new state-based marketplaces beginning in 2014 for individuals and small employers to buy health insurance. Within the rule, several sections are issued as interim final and subject to comment.

The final rule addresses standards for state-operated Exchanges, health insurer standards for Exchange participation and Qualified Health Plans (QHP), and standards that employers must meet to participate in the small business (SHOP) Exchanges. It should be noted that the ruling allows agents and brokers to enroll people into plans under state Exchanges, and it also allows companies to enroll people through privately run websites.

Standards for Establishing and Operating an Exchange
The final rule outlines standards in developing an Exchange that remain unchanged from the prior proposed regulations. Each state can structure its Exchange in its own way, such as a non-profit entity established by the state, an independent public agency, or as part of an existing state agency. A state may decide to operate in partnership with other states (regional Exchange) or with multiple Exchanges that cover distinct areas within the state.

Any Exchange must be approved by HHS no later than January 1, 2013; however, the final rule allows for conditional approval for states that are advanced in preparation but cannot demonstrate complete readiness.

Health Plan Standards
To sell a health plan on an Exchange, insurers and HMOs must be certified as a Qualified Health Plan (QHP) by meeting minimum standards defined in the Patient Protection and Affordable Care Act (PPACA). Exchanges have the power to establish additional standards for health plans offered in their respective marketplace, such as structuring QHP choices and setting timeframes in the health plan accreditation process. Exchanges are allowed to set network adequacy standards to help ensure consumers have timely access to health care professionals.

Eligibility and Enrollment Standards
Exchanges must establish an integrated enrollment system to facilitate determination of eligibility and successful enrollment in the health coverage that best fits the needs of eligible applicants. The rule provides for:

  • A single application for all available programs
  • Coordination with other state programs such as Medicaid and Children’s Health Insurance Plan (CHIP)
  • Easy notification process for life events and annual eligibility redetermination
  • Use of existing electronic data sources to reduce paperwork for consumers
  • New options for interacting with Medicaid agencies when making eligibility determinations that facilitate the administration of premium tax credits

The Exchanges are expected to have toll-free call centers and updated websites to help educate consumers so they may make informed choices about the coverage available on the Exchange and to facilitate consumer enrollment.

Exchanges are required to set up a Navigator process to assist consumers. Navigators may provide consumer outreach, education and assistance with the application process. States are directed to choose at least two Navigator organizations (one of which must be a community or consumer-focused non-profit organization).

Employer Participation on Small Business Health Options Program (SHOP)
The rule sets standards for small employer participation in the SHOP Exchanges, including requirements for employees hired outside of the initial and annual open enrollment period.

Comment Period
While this is considered a final rule, there are several provisions within the final rule that are considered interim final rules subject to a 45-day comment period ending May 9, 2012.

The news that agents  and brokers  can assist Individuals and small companies with the Health Care Exchanges are welcome news, as otherwise our livelihood  would be destroyed. The most important thing is that we will find a way to offer more affordable health insurance  in Santa Monica, so that we reduced the amount of uninsured, who burden the health system.