Health Insurance Exchanges Under the Health Reform Law Mississippi Insurance Department 1001 Woolfolk State Office Building 501 North West Street Jackson, Mississippi · 39201

2 What is an Exchange? Essentially, an exchange is a marketplace for major medical insurance. An exchange is a tool for improving access to health insurance by creating a marketplace where businesses and individuals can easily select and compare health plans This is perhaps an underestimate in that the Exchange: Will be a massive undertaking; Will provide many services beyond simply offering different insurance products for sale; The web portal comparison piece is just the “tip of the iceberg.” The exchange is meant to be a free and open marketplace that encourages competition, innovation, and transparency in the sale and utilization of health insurance

A History of Health Insurance Exchanges Not a new concept Idea was born in the 1970’s 1990’s “Hillarycare” introduced “buying co-ops” Republicans hated it Early 2000’s Heritage Foundation came up with a health insurance exchange concept Looked very similar to a “buying co-op” Included individual mandate Democrats hated it 2006 Massachusetts created the Massachusetts Health Insurance Connector Authority under Governor Mitt Romney Based on Heritage Foundation exchange concept 3

A History of Health Insurance Exchanges 2009 Utah launched its health insurance exchange Designed for small employers only; represents a market-driven solution 2010 Democrats borrowed the Exchange concept and inserted it into PPACA Republicans hated it In Mississippi: The concept of an exchange is accepted across party lines as good public policy Governor Haley Barbour advocated for a market-based, consumer-oriented exchange for 3 years prior to the passage of the Affordable Care Act We are trying to fulfill that vision by creating a state-based market-driven solution Only % of Mississippians have a good understanding of what services an exchange actually provides 4

Minimum Requirements for the Exchange By January 1, 2014, each state shall have in place an operational health insurance exchange to sell individual and small group major medical policies. By January 1, 2013, the Secretary of Health & Human Services (HHS) will determine whether each state will have an effective mechanism in place to run an Exchange by January 1, 2014, and if not, then the Federal government will step in to run the Exchange for the state. Only qualified health plans certified by the Exchange may be offered through the Exchange. HHS issued guidance on Essential Health Benefits on December 16,

Two Types of Exchanges Individual Health Insurance Exchange 6 Small Employer Health Insurance Exchange Individuals & families may purchase qualified coverage through Qualified Health Plans Purchaser may be eligible for premium subsidies—based on income level Small businesses with up to 100 employees may purchase qualified coverage Premium subsidies are not available through the SHOP exchange (tax credits are available for qualified employers) States may choose to operate two separate exchanges or combine into a single mechanism

Mandated Exchange Functions 7 7 Portal / Web site Enrollment and Eligibility Interface Enrollment and Eligibility Interface Carrier 1 Carrier 1 Carrier 2 Carrier 2 Carrier 3 Carrier 3 Health Plan #1 Health Plan #1 Plan Comparison Interface Health Plan #2 Health Plan #2 Health Plan #3 Health Plan #3 Administration Interface Communication Interface TREASURY HOMELAND SECURITY HOMELAND SECURITY IRS HHS SOCIAL SECURITY Verify Citizenship Verify Income Tax Credits Verify Residency STATE Medicaid STATE Medicaid Eligibility Reporting Subsidies Cost Reduction CUSTOMER SERVICE Notifications Pay Premiums Employee or Consumer Employee or Consumer Billing or Invoices Employee or Consumer Employee or Consumer Admin, Life Events, etc. Customer Service ONLINE CALCULATOR Display Total Costs ONLINE CALCULATOR Display Total Costs Health Plan #4 Health Plan #4 Carrier 4 Carrier 4 State Insurance Agency Certify, Recertify Decertify Health Plans State Insurance Agency Certify, Recertify Decertify Health Plans Navigator Guidance Data Service Hub Data Service Hub FISCAL AGENT FISCAL AGENT RISK ADJUSTMENT

What Will a Federal Exchange Look Like? Medicare.gov Will not be tailored to the specific needs of Mississippians “Cookie cutter” exchange for all states that fail to create their own Exchange Federal government may pick two to three national carriers for the Federal Exchange. The Federal government will have sole authority to regulate the insurance plans sold through the exchange to the exclusion of each state’s traditional role in insurance regulation. The Federal government may utilize existing state regulatory agencies to implement law without additional funding or opportunity for input; States will still pay for the Federal exchange. Federal government will regulate health insurance in Mississippi. 8

Value of a State Based Exchange A state-based exchange is designed, built, operated, and controlled by Mississippians It is inevitable that every state will have an exchange Allows insurance agents to play a roll in the exchange The state will have control of what insurance plans are made available through the exchange to both individuals and employers A Federal Exchange will allow the Federal Government to play a much more active and prominent role in Medicaid eligibility and enrollment in Mississippi Mississippi would have oversight concerning the reporting that is required under the ACA regarding individuals who apply and/or enroll through the exchange 9

Mississippi Comprehensive Health Insurance Risk Pool Association The enabling legislation for the Risk Pool is found in Mississippi Code Annotated et seq., 1972 as amended. Subsection (2)(p) specifically states: (2) The association may: (p) Serve as a mechanism to provide health and accident insurance coverage to citizens of this state under any state or federal program designed to enable persons to obtain or maintain health insurance coverage. Section (3) states: (3) The commissioner may, by rule, establish additional powers and duties of the board and may adopt such rules as are necessary and proper to implement Sections through

Mississippi Exchange Blueprint Application November 14 th Letter of Intent November 16 th Blueprint Application Submitted November 26 th Letter from Governor Bryant to Sebelius December 28 th Letter from Governor Bryant to Sebelius Objecting to Commissioner Chaney’s Authority January 15 th AG Opinion regarding Insurance Department’s Authority to Proceed Letter from Commissioner to Sebelius Asserting Authority to Establish an Exchange. 11

Future of Exchanges 12

Mississippi Insurance Department Commissioner Mike Chaney Aaron Sisk · (601)