Affordable Insurance Plans Move Closer to Reality

Details on enrolling in new affordable insurance exchanges to be launched in every state by 2014 under the health care reform law are outlined in a new Department of Health and Human Services (HHS) proposal released on August 12.

A key provision of the health care reform law, these exchanges are designed to afford individuals and small businesses access to a competitive marketplace where they can more easily learn about and purchase affordable health insurance coverage.

The newly proposed rule outlines an approach to plan enrollment that uses electronic systems to verify applicant information, simplifies the process of determining the most appropriate program for applicants' needs, and helps enrollees maintain undisrupted coverage. Additionally, the rule proposes standards for how small businesses can provide affordable health insurance to their employees.

Also released on August 12 were exchange-related rules from the Centers for Medicare and Medicaid Services (CMS) and the IRS, as well as a letter from HHS Secretary Kathleen Sebelius to governors outlining the options and resources for states to work with the agency in setting up affordable insurance exchanges.

CMS's proposal outlines a process for coordinating Medicaid and Children's Health Insurance Program eligibility with the new exchanges, while the IRS's proposal describes how individuals and families can access premium-related tax credits to help defray insurance costs.

Sebelius noted in her letter to state officials that the three new proposed rules follow the release of guidance published in July describing "many of the key areas in which states may choose to tailor their exchange to meet the particular needs of their small businesses and residents."

"We expect to modify these proposals based on the feedback we receive from the American people," Sebelius said. "Furthermore, over the coming weeks, we will actively seek state feedback on these proposed rules through a series of regional meetings."

HHS also announced on August 12 the award of more than $185 million in grants for establishing health insurance exchanges to 13 states and the District of Columbia. In 2010, HHS awarded 49 states and the District of Columbia a total of $50 million to begin planning for the establishment of these exchanges.

HHS's proposed rule is posted at <www.gpo.gov/fdsys/pkg/FR-2011-08-17/pdf/2011-20776.pdf>; CMS's proposed rule is posted at <www.gpo.gov/fdsys/pkg/FR-2011-08-17/pdf/2011-20756.pdf>; and the IRS's notices of proposed rulemaking and public hearing are posted at <www.gpo.gov/fdsys/pkg/FR-2011-08-17/pdf/2011-20728.pdf>. More information about the new proposals, Sebelius's letter, and the establishment grants is posted at <www.healthcare.gov/news/factsheets/exchanges08122011a.html>.