HHS Awards Grants to Help States Implement Affordable Insurance Exchanges

The Department of Health and Human Services (HHS) recently awarded nearly $220 million in affordable insurance exchange grants to 13 states. According to a press release, this gives these states more flexibility and resources to implement the Affordable Care Act.

Under the new health care reform law, states may design affordable insurance exchanges, by which families and small businesses can choose a health insurance plan that fits their needs. Beginning in 2014, the new exchanges will help consumers compare plans, find appropriate coverage and receive answers to help them navigate the market. Insurers will provide new information to consumers, such as a summary of benefits and costs, which is expected to increase competition among insurance providers and drive down costs.

“We are committed to giving states the flexibility to implement the Affordable Care Act in the way that works for them,” Kathleen Sebelius, HHS Secretary, stated in the release. “Exchanges will give consumers more choices and make it easy to compare and shop for insurance plans.”

In anticipation of state legislative sessions beginning in January, HHS also developed several frequently asked questions, with answers that states should know as they begin to set up new exchanges. For example, states that run exchanges have more options than originally proposed in determining eligibility for tax credits and Medicaid. And state insurance rules and operations will continue even if the federal government is facilitating an exchange in the state.

Twelve states received level one grants, which provide funding for 1 year to states that have already made progress using a previous exchange planning grant. The 13th state, Rhode Island, received the first level two grant, which provides multi-year funding to states that are further along in the planning process. Including these states, 29 states are making significant progress in creating exchanges.

HHS has also extended the deadline to apply for a level one grant to June 12, 2012 in order to accommodate the state legislative sessions.

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