As insurers continue to wait on rules outlying the specifics of the federal-run health insurance exchange, healthcare experts are warning that the U.S. Department of Health & Human Services is facing several massive challenges on its road to establishing the online marketplace.
The biggest roadblock HHS must overcome is the varying state insurance markets and Medicaid eligibility requirements that prevent the agency from using a one-size-fits-all approach to the exchange, reported The Hill's Healthwatch.
For example, obesity rates, problems and approaches vary throughout state insurance markets. "Say there's a really big obesity problem in a Southern state. If that state were running its exchange, it could say to insurers, 'We want to make sure you have a plan that encourages diet and exercise,'" Avalere Health CEO Dan Mendelson said. "The program is always tailored to the specific needs of the state."
Jennifer Tolbert, director of state health reform at the Kaiser Family Foundation, agreed. "You can't simply deploy one federal exchange across the board," she told Healthwatch. "Each state is different--their eligibility systems are different, their insurance markets are different. [HHS is] going to have to build these exchanges to fit into the context of each state."
That means HHS could easily--and quickly--exhaust the $1 billion fund for exchange implementation, leading experts to predict that the agency will draw money from other programs to cover the exchange's high costs. Some experts have suggested HHS may add a fee for all insurance products purchased through the federal exchange.
Indeed, Gary Cohen, head of the HHS agency in charge of exchanges, said last week there are "many" differences between state and federal exchanges, including how the costs of running the exchange are assessed and collected, according to CQ HealthBeat.
"If a state is running an exchange, a state gets to decide how those costs should be assessed. Should it be assessed only on companies that are selling products in the exchange? Should it be assessed on the entire insurance market? Should it be assessed in taxes. That's totally up to a state. Otherwise, it's going to be up to us to determine," he said during a press call.
For now, insurers remain in the dark regarding what the federal exchange will look like. While speaking on the press call, Cohen only said that HHS will release guidance on the federal exchange "in the near future," FierceHealthPayer previously reported.