Department of Health and Human Services may need to refine approach on state exchanges

Department of Health and Human Services State Exchanges
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Department of Health and Human Services State ExchangesDepartment of Health and Human Services sees problems with exchange provision

President Obama has won a second term as president and that has major implications  for the Affordable Care Act. The health care reform law have been shrouded in controversy since its passage in 2010, but has remained intact for the past two years. One of the provisions of the law calls for the establishment of  health insurance exchanges. This provision has been well received by some states, but completely opposed by others. Now, the federal government, through the Department of Health and Human Services, may be looking to change its approach on the exchange provision.

Holdout states may delay insurance provisions

According to the Affordable Care Act, all states must build a health insurance exchange by 2014. Approximately 16 states, as well as the District of Columbia, have plans to build their own exchange programs, with 9 others rejecting this provision outright. The remainder of the Union is undecided. These states are considered “holdouts,” and could significantly delay the enactment of the health insurance exchange provision.

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States disinclined to pay for federal mandates

Already this week, the Department of Health and Human Services has had to change its approach to the exchange campaign. Initially, states had until Friday of last week to submit plans to the agency concerning health insurance exchange efforts. Confronted with a huge number of holdout states, the agency decided to push the deadline back to the middle of December. This is meant to provide states with extra time to determine their approach to exchanges. Many of these holdout states suggest that federally mandated programs should be paid with federal money. Though the Department of Health and Human Services does provide financial aid for the exchange efforts of states, the agency does not bear the full financial burden of these programs itself.

States show resistance to expanding Medicaid

Another problem the federal agency is facing is the opposition many holdout states have to expanding their Medicaid program. These programs are meant to be expanded per the Affordable Care Act, boosting their reach to consumers that may need affordable health care. Several states have decried the expansion of these programs due to the high costs that are associated with them and their limited ability to generate profit. Much of the costs associated with these programs are likely to trickle down to consumers.

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