Now that the Supreme Court has ruled the health reform law constitutional, one cornerstone of the law--health insurance exchanges--is moving "full steam ahead," according to reform and exchange experts.
"It's very clear that the ruling moves forward and removes whatever uncertainty had crept into the [exchange conversation] since the oral arguments in March," Bill Hanis, vice president of eHealth technology and exchange solutions, told FierceHealthPayer. "There's no longer a question of funding for public exchanges. It is full steam ahead for exchanges."
Former Maryland Insurance Commissioner Ralph Tyler agrees. "I would expect that in the aftermath of the decision ... there will be a considerable ramping up of activity in states" regardless whether they already took action toward exchange creation, Tyler, who is now partner in law firm Venable's litigation and government divisions, said in an interview with FierceHealthPayer.
However, in the other set of states that have taken little to no action yet, Hanis said he doesn't think these states "will have adequate time to get moving along that lifecycle" before the January deadline. That means there's a good chance the federally run exchange will operate in many states, and that could be bad news for insurers. Tyler said it is "far preferable" for payers to sell plans on state-run exchanges than the federal exchange.
--Bill Hanis, vice president of eHealth technology and exchange solutions
"States know their markets better so it will be more manageable and the technological problems will be less complicated," he explained.
What's more, "insurers already have developed the ability to meet the expectations of regulators in their state," Mark Lutes, attorney with Epstein Becker Green, told FierceHealthPayer. "And since exchanges will be based on specific markets in each state, it isn't better to have a federally run exchange."
In those states that haven't yet passed the necessary statutory authority to establish an exchange, Tyler urged insurance companies to work with governors and state lawmakers to move the legislation along. In states with activity already in place, insurers should continue to be engaged with those efforts. "They are critical to the success of the exchange effort," Tyler added.
Administratively, insurers must strategize to what degree they want to participate in exchanges, what types of products they want to sell on those exchanges and develop processes and technological capabilities to efficiently administer their plans, Hanis said.
Insurers must, for example, "seamlessly deliver plan information and rating methodology and be ready to receive purchasing/enrollment information," Alan Cohen, cofounder and chief strategy officer of private benefits exchange company Liazon, told FierceHealthPayer. "They need to be able to collect premium from the proper entity--the individual, the federal government or an employer."
Although Cohen agrees that insurers must prepare for both state- and federally run exchanges, he says having the federal fallback exchange operating in many states will benefit insurers. "It is actually easier for the insurer," he said. "They work it out with one entity, HHS, and knock off many states. It is more challenging if each state had its own, dissimilar exchange."