The Impact of Health Reform's State Exchanges

The realities of the emerging healthcare marketplace are quickly being recognized. Layna Cook, with law firm, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, discussed these realities with her presentation, “The Impact of Health Reform’s State Exchanges.” Cook says that the Affordable Care Act (ACA) is essential in promoting adequate health coverage for as many Americans as possible. Implementation strategies like individual mandates, employer pay or play penalties, insurance market regulations, and Medicaid expansions are only few of the ways of ensuring increased coverage.

Exchanges, the online marketplaces for individuals and small groups to purchase insurance, will allow individuals to apply for premium subsidies and tax credits. As well, if states opt to run an exchange, they will have to include a Small Business Options Program (SHOP) exchange. SHOPs must meet all the requirements of individual exchanges, except those dealing with premium tax credits and cost-sharing reduction subsidies.

According to Cook, there will be implementation challenges for many stakeholders including the consumers, providers, states, and federal government. However, despite those challenges, by January 2015 all exchanges must be fully operational and self-sustaining.

Exchanges must also ensure health plans meet 2 basic requirements to be considered Quality Health Plans (QHPs). The first is that the issuer must demonstrate compliance with the minimum certification requirements. Second, the exchange must determine that the offered plan is specifically in the interest of qualified individuals and employers. Confirming these requirements will provide consumer benefits like network adequacy, transparency from the issuer, higher standards including that of an inability to discriminate, and other qualifiers that will aid buyers.

One of the final impacts Cook thinks Americans will see are essential health benefits (EHB). Beginning in 2014, all plans in the exchange must offer a standard set of benefits referred to as essential health benefits (EHB). Some of these benefits include ambulatory patient services, emergency services, pediatric services, and hospitalization. Benefit categories are organized by percentage of offered coverage, and out-of-pocket limits. These benefit categories are argued to:

• Allow consumers to easily compare across plans
• Make the consumer shopping experience transparent and simple
• Promote competition on premiums
• Allow plans flexibility to design cost sharing structures

The health reform’s state exchanges will greatly impact payers, patients, and providers. With the help of navigators and these new guidelines, however, it will ensure that all offered plans are in the best interest of individuals and employers.