Each state is eligible to receive up to $1 million in federal grants to establish competitive health insurance exchanges that will become available by 2014 under health reform legislation.
"With most states struggling to keep their budgets in balance, these grants will give them the resources to conduct the research and planning needed to build the health insurance marketplace of the future," U.S. Health and Human Services Secretary Kathleen Sebelius said in a statement Thursday.
"We are working hand-in-hand with states as we carefully implement the Exchanges to make sure they best meet people's health insurance needs."
The administration intends for these exchanges to make purchasing health insurance easier by providing eligible consumers and businesses with "one-stop-shopping," a place to compare various offerings for policies. It is expected that this will give consumers and purchasers greater flexibility and information about the policies before they buy.
If states opt not to establish their own exchanges, or partner with another state or operate a regional exchange, HHS will help establish one on their behalf.
Grant applications are due by September 1, 2010. The agency is asking states to comment by October 4, 2010 on what standards should be required of the exchanges.