By JoAnn Volk, Georgetown Health Policy Institute
Yesterday, HHS issued the first guidance on exchanges, the “first in a series of
documents” they plan to publish
over the next three years to give states the information they need to establish
exchanges. Though the department
plans to issue regulations for public comment in 2011, the goal of this week’s
release is to give states early guidance in advance of their 2011 legislative
sessions. States that were looking for definitive statements on a range of
tough questions about how to set up an exchange won’t find them here – the
Administration defers most of them.
However, the guidance does send some interesting signals, highlighting
areas where HHS will give states a lot of leeway, but making it clear where
they can’t or won’t.
The guidance focuses on four main categories: principles
and priorities; an outline of statutory requirements; clarifications and policy
guidance; and federal support for the establishment of state-based
exchanges. Seven principles and
priorities will inform federal funding and technical support for state-based
exchanges, allowing state flexibility on some areas while outlining statutory
requirements all states must meet.
Specifically, it lists as “state choices”: whether to form the exchange as a governmental agency or
non-profit; whether to form regional exchanges or establish interstate
coordination for certain functions; whether to limit the size of eligible
employers to those with fewer than 50 employees; whether to require additional
benefits in the exchange beyond the essential health benefits; whether to adopt
an active purchaser model or use a more open, clearinghouse model; and whether
to apply the same rules inside and
outside the exchange.
At the same
time, it makes clear that exchanges must serve consumers, citing statutory
requirements for oversight of plans and making information available to
consumers. And it suggests areas
where HHS will be more prescriptive, i.e. risk adjustment, creating comparison
shopping tools, and transparency. One of those “must do” items for states will
be public data reporting to evaluate the exchange’s performance over time. The guidance notes that having these
tools to measure the success of exchanges and identify best practices will be
“critical” given the “diverse strategies” states can pursue on a number of
issues. This requirement sparked
an immediate rebuke from the Governor of Utah who noted that his state “would
prefer something less burdensome.”
This guidance from HHS is just the beginning – there are
a wide range of questions that states want HHS to answer, ranging from
treatment of state benefit mandates to establishment of SHOP exchanges, to the
development of network adequacy and marketing standards. HHS doesn’t seem ready to answer them
all yet, but hopefully there will be additional guidance, because many states
will need to start moving forward with enabling legislation before any final
regulations come out.