This year will prove a crucial one for the future of state health benefit exchanges. Under the Patient Protection and Affordable Care Act, the exchanges are mandated in all states for three years: 2014 through 2016. After that, the states can petition the U.S. Department of Health and Human Services for waivers to set up their own state plans provided the plans conform to the law’s requirements for scope of benefits and access and affordability for individuals and small employers.
How two issues will play out in 2015 will determine how the health benefit exchange marketplace will shape up later this year and during its final mandatory year of operation next year.
The first issue is the widely covered case (King v. Burwell) awaiting a ruling from the U.S. Supreme Court on whether the Obama administration’s regulations on advance tax credit premium subsidies comply with the Affordable Care Act and specifically whether the subsidies are available in states that did not establish an exchange via state action. There’s an outside chance the high court could rule the subsidies cannot be offered in those state exchanges, which many observers conclude could be so disruptive that it could call into question the future viability of the exchanges in those three dozen states.
Secondly, half of the states that did establish an exchange through state action – known as state-based exchanges or SBEs– face significant questions as to the sustainability of their SBEs relative to their financial and/or information technology implementation capacity. These include SBEs in Colorado, Washington, Hawaii, Minnesota, New Hampshire, Rhode Island and Vermont.
Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email