The Department of Health and Human Services today announced policies to assist states in building health care insurance exchanges.  Starting in 2014, these one-stop marketplaces will allow consumers and small businesses to choose a private health insurance plan and offer the public the same kinds of insurance choices as members of Congress.

The HHS final rule will help states in designing their exchanges to best meet the needs of their consumers.  The guidelines offer states substantial flexibility as they design a marketplace that works for their residents.

“These policies give states the flexibility they need to design an exchange that works for them,” said HHS Secretary Kathleen Sebelius. “These new marketplaces will offer Americans one-stop shopping for health insurance, where insurers will compete for your business. More competition will drive down costs and Exchanges will give individuals and small businesses the same purchasing power big businesses have today.”

Today’s policies provide states with the guidance and certainty they need as they continue to work to build these marketplaces for their residents for operation in 2014. The policies offer guidance about the options on how to structure Exchanges in two key areas:

  • Setting standards for establishing exchanges, setting up a Small Business Health Options Program (SHOP), performing the basic functions of an exchange, and certifying health plans for participation in the exchange;
  • Establishing a streamlined, Web-based system for consumers to apply for and enroll in qualified health plans and insurance affordability programs.

The final rule builds on the flexibility and resources provided by HHS already to build state-based exchanges.  A majority of states have taken significant steps in building exchanges. Previously, HHS had awarded 49 states and the District of Columbia $50 million to begin planning their exchanges, and as announced recently, 33 states and the District of Columbia have thus far received more than $667 million in Establishment Grants to begin building their exchanges.