HHS, TREASURY TAKE NEW STEPS TO HELP STATES BUILD AFFORDABLE INSURANCE EXCHANGES
TAX CREDITS TO HELP MILLIONS OF MIDDLE-CLASS FAMILIES
The Departments of Health and Human Services and Treasury today took the next steps to establish Affordable Insurance Exchanges – one-stop marketplaces where consumers can choose a private health insurance plan that fits their health needs and have the same kind of insurance choices as members of Congress. Among other policies, the proposed rules describe how middle-class families will gain access to unprecedented tax relief that will dramatically reduce the cost of coverage.
Since President Obama signed the Affordable Care Act on March 23, 2010, over half of states have taken actions to build an Exchange. Today, HHS awarded $185 million to 13 states and the District of Columbia to help them build Affordable Insurance Exchanges and, with Treasury, posted three proposed rules that will provide a simple, streamlined, and affordable path for consumers to use the Exchanges to purchase private health insurance. Additionally, HHS Secretary Kathleen Sebelius sent a letter to governors laying out options and resources available to states to set up their Exchanges.
“Too many American families have been priced out or locked out of the health insurance market. Exchanges will give them control and could save them thousands of dollars a year,” said Secretary Sebelius. “I am encouraged by the progress states have made to date and am excited to give them more resources to continue their work.”
“Today we’re laying the foundation to provide tax incentives to help working families purchase health insurance,” said Treasury Secretary Tim Geithner. “This new tax credit brings us a big step closer to achieving one of the signature goals of the Affordable Care Act – to provide tens of millions of Americans with access to affordable health insurance coverage.”
The Affordable Care Act creates Affordable Insurance Exchanges that will allow eligible individuals, families, and small businesses to shop for coverage starting in 2014. More than half the states have already taken action to begin building an Exchange and the new grant awards will accelerate that progress. The Exchange Establishment grants awarded today build on earlier investments in states. In 2010, HHS awarded 49 states and the District of Columbia $50 million to begin planning their Exchanges. HHS expects to make more grant awards in coming months.
The three proposed rules released by HHS and Treasury focus on the following:
- Easy, Simple Access to Coverage for Consumers and Small Businesses: New rules will make it easy for consumers to enroll in high-quality health plans and get help paying for health coverage through premium tax credits and cost sharing reductions. Small employers participating in the Small Business Health Options Program will be able to offer their employees a choice of health plans and cut their costs with new tax credits.
- Health Insurance Premium Tax Credit: Individuals and families will receive premium tax credits to help defray insurance costs, increasing access to health coverage for millions of middle class American families.
- Medicaid Eligibility: Coordinating the Exchange with Medicaid and Children’s Health Insurance Program eligibility will make enrollment seamless for qualified Americans and reduce the administrative burden on states.
In her letter to Governors, Sebelius lays out an innovative partnership that will allow states to work with HHS to set up Exchanges while making more efficient use of shared resources. The letter solicits comments from states on how the partnership model can build on the substantial flexibility states have when designing an Exchange that works for them.
In the weeks ahead, the Administration will conduct an aggressive outreach campaign and ask for public comment on the three proposed rules from employers, consumers, state leaders, health care providers and insurers, and the American people. In addition to accepting written public comments for the next 75 days, the departments will hold forums. These forums will help ensure more Americans have the opportunity to share their views regarding the establishment of Affordable Insurance Exchanges. Forums will be held in:
- Atlanta, GA
- Chicago, IL
- Denver, CO
- New York, NY
- Portland, OR
- Sacramento, CA
The departments expect to modify the proposed rules issued today based on the feedback we receive from the American people.
To view a detailed list of states that received grants visit: www.HealthCare.gov/news/factsheets/exchanges05232011a.html.
For more information about the proposed rules, visit:
- Easy, Simple Access to Coverage for Consumers and Small Businesses: www.HealthCare.gov/news/factsheets/exchanges08122011b.html
- Health Insurance Premium Tax Credit: www.treasury.gov/press-center/Documents/36BFactSheet.PDF
- Medicaid Eligibility: www.HealthCare.gov/news/factsheets/exchanges08122011c.html
A copy of the letter is available here: www.HealthCare.gov/center/letters/exchanges08122011a.html.