HHS: Exchange implementation will cost extra $1.5B

It appears health insurance exchanges are proving more costly to implement than the U.S. Department of Health & Human Services initially thought, which is why the agency has requested additional funding to help create the online marketplaces.

In its fiscal year 2014 budget, HHS asked Congress for $1.5 billion to set up the federally-run exchanges, including paying for basic operational functions and conducting education and outreach to ensure consumers actually enroll in the marketplaces, which will operate in at least 33 states.

HHS estimated it will cost more than $4 billion to create both federal and state-run versions of the marketplaces. Just last year, however, the agency predicted it would cost $2 million, reported The Hill's Healthwatch.

The problem is that HHS expected most states would elect to establish and operate their own exchange, particularly since the reform law offers subsidies to states that set up exchanges. Instead, a majority of states have chosen to let HHS run their exchanges, leaving the agency lacking necessary resources, according to Kaiser Health News.

When asked about what steps HHS would take if Congress doesn't approve its budget request, HHS Secretary Kathleen Sebelius said during a press conference Wednesday she's hopeful lawmakers will finally recognize the reform law as the "law of the land."

To learn more:
- here's the HHS budget
- read The Hill's Healthwatch article
- see the Kaiser Health News article

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