Low enrollment, technical issues hit state exchange budgets

The financial challenges facing state health insurance exchanges are no secret--and a recent Commonwealth Fund report spelled out the struggles each state faces in its efforts to achieve financial sustainability.

Collectively, the state exchanges have received $4.3 billion in federal grant money under the Affordable Care Act, the report noted. Critically, though, no new money was awarded after Jan. 1, 2015.

This has left exchanges in a bind. Colorado, Rhode Island and Washington have requested additional funding from state budgets, the report said--and lawmakers in those states have not been shy about scrutinizing the state exchanges. The District of Columbia, Massachusetts, Minnesota, Nevada, New Mexico, Oregon and Washington intend to boost insurer assessment levels. Meanwhile, Covered California has proposed a 15 percent budget decrease for the upcoming fiscal year, FierceHealthPayer previously reported.

Reasons for financial troubles vary. Lower premiums on the Connecticut exchange benefit consumers, the report said, but they conversely bring in less revenue for the exchange entity. Low enrollment led to budget cuts in Minnesota as well as in California, while increased spending on technical issues has hurt Colorado, Massachusetts and Vermont.

Ultimately, the Commonwealth Fund concluded, it may be in certain states' best interest to follow the example of Nevada and Oregon, which run their own exchanges but use the Healthcare.gov IT platform. Hawaii plans to turns its exchange over to the federal government for the 2016 plan year, and Vermont is also considering such a move.

For more:
here's the Commonwealth Fund report

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