New Hampshire Insurance Department officials say taking a $1 million federal health insurance exchange planning grant might be a good idea.

The department can take the $1 million even if the state decides not to set up an exchange, and, if the state decides not to set up an exchange, the U.S. Department of Health and Human Services (HHS) may simply set up an exchange for New Hampshire, officials say in an exchange planning grant memo.

The federal exchange would make all Medicaid eligibility and enrollment decisions for New Hampshire, and New Hampshire would be responsible for paying its state share without having any say over the determinations, officials say.

Congress included the exchange provisions in the Patient Protection and Affordable Care Act (PPACA). If PPACA takes effect as written, the exchanges will create “one-stop shopping” for health coverage starting in 2014. Individuals and small groups will be able to use new tax subsidies to buy coverage through the exchanges.

New Hampshire officials note that, if the state decides to set up its own exchange, the exchange could take one of many different forms.

The exchange could help consumers bargain for coverage offered by a limited number of carriers, or it could let carriers offer any coverage that meets basic federal requirements.

The exchange could be a state agency or a nonprofit corporation, and it could be

integrated with Medicaid or operated separately.

HHS is providing a $1 million exchange planning grant to any state that wants a grant, officials say.

“Acceptance of the exchange planning grant does not commit a state to establishing a state based exchange,” officials say. “A state may determine after evaluating the options and requirements imposed by federal law that it will not establish a state based exchange.”

A state also can apply for a separate “Early Innovator Grant,” to develop the technology needed to operate an exchange, and New England states have received $35 million in Early Innovator grants, officials say.

Later, officials say, HHS plans to provide implementation grants for states that are actually implementing exchanges.

“The federal government has assumed responsibility for all state costs related to the establishment and development of a state based exchange and will provide that funding through exchange implementation grants,” officials say.

All states but Alaska have received a $1 million exchange planning grant, but Louisiana is trying to return its grant, and Florida has stopped developing exchange plans but has not yet decided whether to return its grant, officials say.

- Allison Bell

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