Legislation to create health insurance exchanges has overcome partisan perceptions and is on its way to Gov. John Hickenlooper’s desk.
Now the stage is set for the hard work — assembling a nine-member board that will create the exchange blueprint within two years.
The exchanges are clearinghouses of information for small business owners and individuals looking for insurance. They’re the result of months of community hearings and a bipartisan effort from doctors, business leaders and consumer advocates.
Exchanges are a new tool that will drive changes in health care delivery and purportedly lower insurance premiums by acting as retail centers for insurance. Consumers will be able to compare policies, get rates and apply federal subsidies as needed — all in a single location.
“This is good news for Colorado,” said DeDe DePercin, executive director of the Colorado Consumer Health Initiative, one of the driving forces behind the exchange bill. “There’s a lot of value in it — a free, competitive marketplace.”
But the bill in Colorado hit a speed bump on its way through the General Assembly. A small, but vocal, group of Tea Party supporters threatened to derail the process by aligning the idea with “ObamaCare,” their term for federal health care reform initiated by President Barack Obama.
While Colorado received money from Congress – about $1 million so far – to set up the exchanges, supporters say it isn’t tied to federal reform. Its only connection to the Affordable Care Act is that the 300,000 people in the state eligible for federal insurance subsidies under the act are required to use the exchanges.
“We are greatly relieved that this passed,” said Tony Gagliardi, Colorado’s executive director of the National Federation of Independent Businesses. “Now the real work begins.”
Senate Bill 200 is only the first step to create the exchanges. It will create a nine-member board that will be responsible for setting up a health care exchange, which combine individuals and small businesses to create a very larger, very stable risk pool for insurers.
“We’re going to be very, very careful about who we put on that board,” Gagliardi said. “We’ll make sure that the interests of small businesses are seen to — and there will be representatives from small and independent businesses on the board. That’s in the legislation.”
The new board will be responsible for creating the framework for the entire exchange, and time is limited. They must have the board and initial blueprint in place by January 2013.
The exchanges will have to be set up in a way that they wed complex insurance policies with state-of-the-art technology and will require hiring new people to work within state government who are savvy about health policy and insurance programs.
“We have a long way to go,” said De De DePercin, executive director of the Colorado Consumer Health Initiative, one of the groups instrumental in developing the exchanges. “We’ve gotten a pretty good start.”
DePercin anticipates the exchanges will be in place in step with federal guidelines, but not much earlier.
As Rep. Amy Stephens, R-Monument and sponsor of the bill, said, if the state didn’t pass its own program — the federal government will come in to create one for Colorado.
Colorado is following in the footsteps of its neighbor, Utah, said Tony Gagliardi.
Utah was the first state to have a market based exchange — and Colorado is using it as a model, he said.
“Today many small business employers can now contribute premium dollars into its exchange and let employees decide which plans to choose from, and if there’s a better plan requiring a little more money, the employee can contribute the difference,” he said in a statement on the NFIB’s web site.
“We owe it to the small business to keep vigilant about these exchanges, to make sure they stay within the intent of the bill — a free market, with choice and a competitive market that allows all insurers into it. That’s what we’re going to put into place,” he said.
There are still issues to be decided, DePercin said. The board will have to hire a director and staff, and will have to decide how the exchanges will influence the insurance market, and how it will help consumers and small businesses understand, compare and purchase insurance.
“To be successful we’ll have to develop a plan that connects people to the coverage,” she said. “We also have to make sure that they’re comparing apples to apples. There are so many different plans out there, which do so many different things. We have to organize the information in a way that makes sense to the average consumer. Insurance is complicated, so we have a job in front of us.”
Gagliardi believes the opponents to the exchange can be won over.
“I am optimistic that once people see what we have planned, what the results are, the opposition will fade away,” he said.