Inside Health Insurance Exchanges Turns to Joel Ario for Insight into Health Reform

Inside Health Insurance Exchanges Turns to Joel Ario for Insight into Health Reform

“HHS Offers Vision for State Partnerships; Feds May Have to Run More Exchanges” and “Feds Set Low Bar for FFE Participation; States May Follow”
Inside Health Insurance Exchanges

June 18, 2012 – Inside Health Insurance Exchanges looked to Manatt’s Joel S. Ario, a managing director with Manatt Health Solutions for insight into state partnership exchanges (SPEs) and federally facilitated exchanges (FFE). Ario was quoted in two articles that were published by the health news outlet on June 18, 2012.

In “HHS Offers Vision for State Partnerships; Feds May Have to Run More Exchanges,” the publication reports that the U.S. Department of Health and Human Services (HHS) recently released documents that outlined the application process for states that want to run their own exchanges. However, it will be difficult for states to choose a model until HHS can provide details as to how much it will cost to have the feds take on certain exchange-related functions. Some industry observers predict that only a handful of states will be prepared to operate an exchange on their own by 2014. Some states may also unexpectedly end up with a federally run exchange if their governor fails to declare which model the state intends to implement.

States have less than six months to have their exchanges certified by HHS. As a result of the tight deadline, the state partnership model “is an increasingly attractive option for states,” said Ario, who headed HHS’s Office of Insurance Exchanges before joining Manatt. “What it allows them to do is take more time to get it right in their state and work with the federal government in the meantime to deliver good results to their consumers. The partnership can be a way station to a state-run exchange, and I think in most cases it will be,” he added.

In “Feds Set Low Bar for FFE Participation; States May Follow,” the publication reports that HHS announced on May 16 that any willing health insurer that has URAC [formerly Utilization Review Accreditation Commission] or NCQA [National Committee for Quality Assurance] accreditation will be allowed to participate in a federally facilitated health insurance exchange until the fourth year of certification when more specific accreditation will be required.

Allowing all qualified health insurers to participate in federally facilitated exchanges is a very “insurer-friendly policy,” said Ario. He continues to tell the publication that most states will follow HHS’s lead and operate their exchanges as clearinghouses, rather than as active purchasers. “It’s better to start with a broad group [of participating insurers] and get as many choices out there as possible.” But as the exchanges evolve, he predicts that consumers will push for greater standardization among products so that choices can be compared more easily. And as exchanges build membership, they will gain greater bargaining power and will be more likely to trim the number of participating carriers to enhance market power, he added.

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