A legislator in a state that already has a health insurance exchange said any federal exchange rules should be as loose as possible.
Rep. David Clark, R-Santa Clara, Utah, appeared at a hearing of the Senate Health, Education, Labor and Pensions Committee at a hearing on implementation of the health insurance exchange distribution system provisions in the Patient Protection and Affordable Care Act (PPACA).
“My plea to you today is for help to ensure that as the [PPACA] is implemented, the U.S. Department of Health and Human Services (HHS) uses a light touch and resists the temptation to fill in too many of the missing details,” Clark said.
The Exchange System
Republicans are trying to block implementation of PPACA. If the act takes effect as written, it is supposed to create a health insurance exchange system in 2014.
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An exchange would sell individual, family and small group insurance products on a guaranteed-issue basis. Carriers could take an insured’s age into account when pricing coverage but not the insured’s health status.
Low-income and moderate-income consumers could use a new system of tax subsidies to pay for part of the cost of the coverage.
A state could establish one or more exchanges within its borders, join a multi-state exchange program, or have the federal government provide exchange services for its residents.
Steven Larsen, director of the federal Center for Consumer Information and Insurance Oversight (CCIIO), an arm of the U.S. Department of Health and Human Services (HHS) that is overseeing the development of the exchange system, noted that HHS already has awarded $296 million in exchange planning grants to states and territories.
Kansas, for example, is trying to develop a national exchange information technology infrastructure, and Rhode Island, Vermont and Connecticut are in a multi-state exchange development consortium, Larsen said.
California enacted insurance exchange laws in September 2010, and states such as Maryland and Colorado are conducting research on exchanges and holding public forums, Larsen said.
Sandy Praeger, the Kansas insurance commissioner, who appeared at the hearing on behalf of the National Association of Insurance Commissioners (NAIC), Kansas City, Mo., told lawmakers that the NAIC already has developed an American Health Benefit Exchange Model Act to serve as a framework for exchange efforts.
The NAIC tried to make the model flexible and fill in gaps with white papers that provide information and ideas, rather than more rules, Praeger said.
In Kansas, regulators are already using exchange planning money and are preparing to apply for an exchange establishment grant, Praeger said.