HIEs: Still More Questions than Answers

Last week the Department of Health and Human Services doled out more than $240 million in grants to seven "early innovator" states with the intent of helping them implement the IT infrastructure required to support health insurance exchanges.

It's one of the first wide-scale signs of progress towards a critical healthcare reform feature that will guide how consumers will purchase health insurance that's not supplied as part of an employer benefits package.

But the agency's action also highlights lingering questions about insurance exchanges. Those questions are dominated by the fact that while states are largely on their own to determine what the final product will look like when they are up and running by 2014, they still must conform with overarching principles established by the law.

By all accounts, the health insurance exchange concept is one of the few Accountable Care Act provisions with bipartisan support. Yet there is plenty of discontent to go around. In a mid-February letter to HHS Secretary Kathleen Sebelius, 21 Republican governors lamented being largely excluded from providing input on the law and said the exchange system proposed is "seriously flawed."

They are asking that HHS provide states with "complete flexibility on operating the exchange[s], most importantly the freedom to decide which licensed insurers are permitted to offer their products." Among other items, the governors asked HHS to grant states the authority to choose the benefits that meet the specific needs of their citizens. HHS currently has the authority to determine what insurers must offer as part of an "essential benefits package," with rules to be released this fall.