Seven states will receive funding to design, implement, and model the infrastructure to operate health insurance exchanges.
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As the Department of Health and Human Services (HHS) continues to foster the development of health insurance exchanges (HIEs) in states across the country, HHS announced Wednesday that $241 million has been awarded to help a group of "Early Innovator" states design and implement the information technology (IT) infrastructure needed to operate their exchanges.
Described as states that are leading the effort to develop a better health insurance marketplace, HHS said the new funds will be used by the Early Innovator states to build exchange IT models that can be replicated by other states.
"Early Innovator states will play a critical role in developing a consumer-friendly marketplace where insurers must compete to deliver the best deal," HHS secretary Kathleen Sebelius said in a statement "These grants ensure that consumers in every state will be able to easily navigate their way through health insurance options."
According to HHS officials, the seven grantees were selected based on their readiness to develop and use innovative IT approaches for their HIE systems. Grantees demonstrated that they have begun planning work for their exchanges and are committed to establishing an exchange that will serve their state. They also showed their technical expertise and ability to develop these IT systems on a fast-track schedule, and their willingness to share design and implementation solutions with other states.
The seven Early Innovator awardees are:
-- Kansas Insurance Department, $31,537,465
-- Maryland Dept of Health and Mental Hygiene, $6,227,454
-- University of Massachusetts Medical School (multi-state consortia), $35,591,333
-- New York Department of Health, $27,431,432
-- Oklahoma Health Care Authority, $54,582,269
-- Oregon Health Authority, $48,096,307
-- Wisconsin Department of Health Services, $37,757,266
The exchange IT systems must be able to handle eligibility and enrollment as well as premium tax credits and cost-sharing reductions for eligible consumers, HHS officials said. The exchange IT systems must also be interoperable and integrated with state Medicaid programs to allow consumers to easily switch from private insurance to Medicaid and the Children's Health Insurance Program as their eligibility changes.
All Early Innovator states have committed to assuring that the technology they develop is reusable and transferable. Using the grants, states will develop the building blocks for exchange IT systems, providing models for how exchange IT systems can be created.
While the Early Innovator states will help other states establish their exchanges quickly, states using the Early Innovator models will continue to have the flexibility to develop an exchange that best meets the needs of their unique health insurance market without having to start from scratch.
HHS said the seven grantees represent different regions of the country, as well as different exchange governance structures and information systems. This diversity will help ensure that a wide range of IT models are developed, and every state will benefit.
HIEs allow individuals and small-business owners to pool their purchasing power to negotiate lower rates. Information about insurance plans will be posted online in each state, and starting in 2014, exchanges will help individuals and small employers shop for, select, and enroll in high-quality, affordable private health plans that fit their individual needs at competitive prices.