Washington's fledgling health-insurance exchange moves ahead ...

OLYMPIA ? Washington state moved closer this week to opening its own online marketplace for consumers to shop for health insurance.

As a part of President Barack Obama's sweeping health-care reform law, states are mandated to adopt by 2014 state-run insurance marketplaces ? called exchanges ? or allow the federal government to run one for them.

Each exchange will include a range of coverage and price choices for individual and small-group health insurance plans.

Washington's exchange will essentially be a public-private partnership designed to give consumers an easy way to compare the benefits of various plans, said Richard Onizuka, the assistant director of the Health Care Policy Division of the state Health Care Authority. It will be developed and implemented by a board of nine officials from health agencies, the medical industry and other sectors appointed by Gov. Chris Gregoire and two non-voting members.

"The intent is that it will be one place for (consumers) to go," Onizuka said. "There are still a lot of operational things that need to be built."

Along with the website, the exchange will perform several functions. It will certify qualified health plans based on federal standards, provide information for consumers about their eligibility for Medicaid and other health programs, and operate a hotline for consumers. It will also run "navigator" programs, systems set up to inform people and assist them in purchasing the best health plan for them.

The exchange will offer several categories of plans. Platinum, the highest-coverage option, will pay for 90 percent of the costs to cover a list of benefits the government considers essential, such as emergency care. Bronze, a lower-coverage option, will pay for 60 percent of the costs. Silver and gold plans will fall between the two. The "essential benefits" covered in each plan include access to prescription drugs, mental health care, hospitalization and maternity care.

Under the new system, catastrophic plans will be offered solely inside the exchange. These plans are only available for low-income consumers age 30 or younger, and they offer a low coverage level.

States have the option to devise their own lists of "essential benefits." Starting Dec. 15 and continued for each following year, the Insurance Commissioner must turn in a list of state-mandated benefits to the Legislature.

Under the new system, insurance providers will be able to sell plans outside the exchange if they so choose. Concern recently arose at the Insurance Commissioner's Office over the possibility that providers would opt to offer cheaper plans outside the exchange without providing more expensive and options.

"There was a push to only offer bronze-level plans outside the market," said Stephanie Marquis, a spokeswoman for the Insurance Commissioner's Office. Doing so would allow providers to cover only the young and healthy as opposed to riskier consumers.

This was specifically addressed in a bill that passed the Legislature earlier this month to establish rules for the exchange, Marquis said. The rules ensured that carriers who offer bronze plans must also offer silver and gold plans.

"We are very pleased with the bill that passed, especially with the marketplace rules," she said. "We wanted a level playing field."

The insurance industry has shown a lukewarm reaction to the exchange. Some praise it as a reform that will usher more fairness and transparency into the insurance market. But Brian Berg, a member of the Life and Health Advisory for the Insurance Commissioner's Office and co-vice president and secretary of Floyd Watkins & Associates, a Vancouver insurance firm, joins many in his belief that the exchange will complicate the health-care system.

"The insurance companies are basically going to be in a situation in which they have to accept any kind of risk," he said. "From a premium standpoint and from a risk standpoint, it's going to do nothing but drive up rates."

Upwards of 30 million Americans are projected to use the new insurance exchanges. States are supposed to decide whether to run their own exchanges by the end of the year, but the Obama administration announced Monday that it would allow them to open their exchanges one year late.

-- Justin Runquist

Source: http://www.oregonlive.com/politics/index.ssf/2012/03/washingtons_fledgling_health_i.html

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