I read a piece earlier today that stated that nearly 50% of Americans do not know about national health care reform or (PPACA).  So, if about half of the country is not up to speed on health care reform, what do you think the percentage of people who are not up to speed on Exchanges – 70, 80%?

Health Insurance MarketplaceThat could change in a hurry with the media campaigns and navigator / assister programs lined up for August 2013 and beyond.

Beginning in 2014, individuals and small businesses through brokers with up to 50 employees can purchase insurance through online health insurance marketplaces or exchanges (Tweet this). These exchanges will offer a choice of health plans that meet certain benefit and cost standards.  In 2016, businesses with up to 100 employees can also participate in the exchanges (Tweet this).

Creation of these exchanges is a complex and expensive proposition.  Having seen close up the work done to get Massachusetts ready for 2014 and remembering that Massachusetts was and is light years ahead of other states due to their health care reform efforts, the information technology piece of the puzzle is the most crucial component of the exchanges.  With the myriad of checks and balances, look ups, verifications and filters, the new systems will be unlike any other in the insurance field.

This has led many to questions whether the exchanges will be ready for the product launch on 10/1/2013 for effective dates of 1/1/2014.  With marketing efforts already underway, the feeling is that the exchanges will be up and running, but like any other first year product launch, it will be fraught with challenges and glitches.  All eyes will be on the exchanges as a political element looms – if they stumble out of the gate or do not open on time, there will be negative repercussions for the Democrats at the election booths in the near future who supported and rammed this legislation through.  Republicans have repeatedly tried to eliminate, weaken and disassemble PPACA.  Late opening Exchanges or faulty exchanges could be the jump start needed to begin the process.  A strong start by the Exchanges can hamper the Republican efforts.

For now, the Exchanges effort is full steam ahead.  The Exchanges will be another distribution channel for individuals and brokers and small businesses to shop for health and dental insurance.  No price breaks or differentiation is in store other than being a eligibility verification entity, along with being a repository of product information and pricing.  Coordination of actions for small business through your broker will assist in the process as the complexity of products through the Exchanges.  For individuals, the Exchanges will provide the eligibility verification for potential subsidization opportunities along with product and prices of health insurances to fit their needs.

The Exchanges will require additional education to fully roll out PPACA.  For small business and the myriad of brokers who support them, the Exchanges will be another distribution channel while individuals who are not currently insured and those who may be eligible for subsidies, it will be the go-to vehicle.  With the hundreds of millions needed to implement the plans on a state by state basis along with the federal taxes and fees being applied to cover the nearly 30 million uninsured, the cost of health insurance, expected to increase at a double digit clip in 2014.  These cost increases will force people to take note of these exchanges and utilize them if needed.  There are nearly 30 million reasons to do so.


Shopping Mall Image Credit: Roberto Verzo via Flickr

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Teri Weber

Teri Weber

Partner at Spring Consulting Group, LLC
Teri Weber, ACI is a Senior Vice President with Spring Consulting Group. She has over 10 years of experience in health and welfare plan strategy, design, pricing, and implementation. She also works with absence management programs, including disability, family medical leave and leave of absence tracking. Her areas of expertise have allowed her to work with diverse employers and vendors to streamline processes and programs to meet the needs of insurers, administrators, employers and employees. Teri is on the Board for the New England Employee Benefits Council (NEEBC) and recently served as lead editor for the Disability Management Employer Coalition’s (DMEC) Return to Work Program Manual. Prior to joining Spring, Teri worked with Watson Wyatt, Buck Consultants and AON Consulting. In addition she was an Account Manager with Health Direct, Inc. Teri earned a BS at the University of Connecticut and a MBA at the University of Massachusetts. She holds an ACI designation and is a licensed broker in the states of MA and CT.