The Department of Health and Human Services has awarded $241 million to seven states to help fund their design and implementation of insurance exchanges. Awarded to “Early Innovator” states, the money will help establish the infrastructure needed to operate the exchanges. The HHS is encouraging that others follow the example set by these states when they begin building their own exchanges.
The seven states, Kansas, Maryland, Massachusetts, New York, Oklahoma, Oregon, and Wisconsin, will share the funds – larger states will receive more than smaller states. They were selected based on their approaches to the health insurance exchange system.
The health insurance exchanges are designed to be a medium through which individuals and families can find insurance coverage they need. It helps them locate policies and connect with agents they would not normally be able to find by themselves. The exchanges will create affordable options for those looking for coverage, creating competition in the industry and driving premiums lower from other providers.
Participation in the exchanges is voluntary for citizens, but their implementation is mandatory for states. States must establish the insurance exchanges by 2014 or the federal government will establish the exchanges for them.
The HHS has said that the grantees represent different governance structures and that the diversity in their approaches will help ensure a wide range of IT models that will benefit every state.
While the overarching health care reform plan introduced by the Obama administration has been a point of intense political conflict, the health insurance exchange provisions have been considered a step in the right direction.