Federal Vs State Health Insurance Exchange–Does It Matter?

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As part of the Affordable Care Act, every state must have a health insurance exchange in place by January 2014. An exchange is a clearinghouse of sorts where people and small business can go to buy insurance and also find out which tax rebates they may use to help them buy coverage.

“I’ve heard people compare it to Expedia or Travelocity,” says Lisa Kaplan Howe, policy director for NH Voices for Health. “You can do an apples to apples comparison of premiums and benefits and for the first time have all the information laid out in one place and be able to go to that place to purchase something to suit your needs.”

Under the new health insurance exchanges small employers and families that are 400 percent above the poverty line will qualify for subsidies to buy health insurance. That’s up to $90,000 a year for a family of four.

New Hampshire lawmakers gave back the $1 million in planning grants to the federal government in order to establish a state based exchange. Legislation that would have set up a state-based exchange has stalled.

Beth Roberts, Vice President of Regional Markets at Harvard Pilgrim Health Care, is disappointed. “Why not control our own destiny?” she says. “What we need in New Hampshire is different than what another state in the nation needs. By defaulting to a federal exchange we are allowing the federal government to come in define what New Hampshire needs for us rather than building an exchange at the state level allowing us to define that.”

But opponents of a state-based exchange say whether or not the state controls the process, ultimately, the federal government will have the final say.

“Whether we have a federally implemented exchange or a state implemented exchange the federal government writes all the rules,” says Charlie Arlinghaus, who runs the Josiah Bartlett Center. “We’re essentially just a puppet government.”

Republican Rep. Andrew Manuse of Derry has sponsored legislation that would prevent New Hampshire from creating its own health insurance exchange.

“By not establishing a state exchange were saying to the federal government, you passed this mess of a law now you have to figure out how to make it work. Don’t rely on the states to fix this law,” says Manuse.

Manuse says he hopes the entire Affordable Care Act will be repealed. Next month the U.S. Supreme Court will determine the fate of the law, which is being challenged in a suit brought on by 26 states that claim it is unconstitutional.


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