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Officials favor more state control in new health insurance exchange

Whatever form New Hampshire’s new health insurance exchange will take when it launches in 2014, a panel of experts and neophytes involved in crafting it agreed yesterday they want the state to keep as much regulatory power over insurance as possible.

As for how much of that control the state can actually preserve – with deadlines and funding grants to establish a state-controlled exchange passing by – neither state officials nor the new Health Exchange Advisory Board were optimistic.

President Obama’s re-election last week erased doubts about whether the Affordable Care Act would be implemented. That means, come Jan. 1, 2014, each state in the country will need to offer health insurance exchanges to its residents.

The exchanges are marketplaces where uninsured people and small businesses will be able to shop for insurance coverage. The health care law allows three types of exchanges: state-based, where the state government has the most direct regulatory control; federally-facilitated, where the federal government dictates and provides a structure for the exchange; and partnerships between the state and federal government.

The deadline to declare an intent to establish either a state-based or partnership exchange was extended last week from Friday to Dec. 14. States that don’t issue declarations by then, or don’t submit a blueprint for their exchange by Feb. 15, 2013, will have to use and support federally-designed exchanges when they launch on Jan. 1, 2014.

“Without the time and the planning grants, we’re faced with a federally-enabled exchange, no matter how hard we wish for otherwise,” said Scott Baetz, owner of a five-employee website design firm in Windham and co-chairman of the new advisory board.

Co-chairwoman Lisa Guertin of Hollis, president of Anthem Blue Cross and Blue Shield, said after the meeting it’s probably not that black-and-white.

“We need to separate the idea of state control from having a state-based exchange. We, for instance, as a large insurer in the state, have weighed in in favor of keeping regulation at the state level. We just feel that works and it should continue to work.

“I thought I heard everyone in the room say they want New Hampshire to have a strong input in what this exchange looks like. It may be that (the time frame is) too short to do that for 1-1-14,” she said. “In real life, you always have some constraints and we certainly have them, but it doesn’t mean we can’t as a group set the path for New Hampshire and make sure we’re on the right one.”

Yesterday, the 12 members of the advisory board met for the first time with state officials to begin advising them on how best to structure the new insurance marketplace.

The board includes state Sen. Ray White, an insurance broker and a Bedford Republican who did not seek another term. He provided the other members with some historical context from his time in the Senate.

“There were basically two camps in the State House in the last session,” he told the rest of the board. “One camp was somewhat opposed to the legislation but thought we should get out in front of it. . . . I was in that camp, and we proposed a state exchange to preserve the state regulatory role. The other camp said to the federal government, basically, ‘We won’t play. You’re gonna have to implement everything.’

“At the end of the day, that second camp won,” and passed legislation banning the creation of a state-based exchange or the expenditure of federal dollars to implement the reform law, White said.

But the 2013 Legislature will be a dramatically different one, from a solidly Republican House and Senate to a Democratic-controlled House and a Senate narrowly split between the parties.

As a result of the election, the philosophical support for a state-based exchange grew “on a scale of 1 to 10, from a quarter or a half, to six or seven,” White said.

But even with increased support in the State House, and the federal deadline for declaring an intent to implement a state-based exchange or a partnership recently extended to next month, there’s likely not enough time to create the technological infrastructure for one by 2014, state officials told the advisory board yesterday.

“We’ll be looking for your input on eventually moving to a state-based exchange, but I think it’s impossible to have one for 2014,” said Jennifer Patterson, life, accident and health legal counsel for the New Hampshire Insurance Department.

Even under a federally-facilitated exchange, the state faces “tremendous IT (information technology) work,” said Health and Human Services Commissioner Nick Toumpas.

In Massachusetts, which began working on its state-based exchange in 2010, work is projected to finish just under the wire for the Jan. 1, 2014, deadline, said Bill Baggeroer, chief information officer for the state Health and Human Services department.

The Legislature, particularly the six-member Joint Health Care Reform Oversight Committee, will call the shots in developing either a partnership exchange or the infrastructure to support a federal exchange, aided by Toumpas and his staff, and Insurance Commissioner Roger Sevigny and his staff.

The advisory board will provide feedback to the joint committee and the two commissioners, drawing on their experiences as insurance industry insiders, small-business owners and consumer advocates.

(Sarah Palermo can be reached at 369-3322 or spalermo@cmonitor.com or on Twitter @SPalermoNews.)

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