HHS will integrate state regulatory activities in exchanges

June 1, 2013

Eventually, states could expand their roles in the exchange operations

A State Partnership Exchange is one of three models of Affordable Care Act exchanges, representing the hybrid choice between a State-based Exchange and the Federally-facilitated Exchange (FFE). Under  a the Partnership approach, states will assume primary responsibility for some FFE functions-either permanently or as they work toward a State-based Exchange.

States have two primary options when pursuing State Partnership Exchanges: a Plan Management Partnership or Consumer Partnership. States also have the choice to participate in both Partnership models.

Specifically, states participating in Plan Management Partnerships will assume responsibility over issuer account management, issuer oversight and monitoring, quality reporting and data collection. In addition, these states will also play a key role in qualified health plan (QHP) certification. Yet, while Plan Management Partnerships will recommend which plans should be certified as QHPs to HHS, HHS will not fully delegate the responsibility of QHP certification to states. States in a Plan Management Partnership will be required to complete the QHP review process and send recommendations and data to the Department of Health and Human Services (HHS) by July 31, 2013.

It is important to note that HHS anticipates integrating states’ regulatory activities into its decision-making for QHP certification, regardless of the chosen Exchange model. This is because many of the criteria associated with QHP certification rely on factors typically considered by state regulatory bodies. HHS intends to work with states to determine a method for exchanging information that states wish to share in this context.

In addition to the Plan Management Partnership, states have the option to pursue a Consumer Partnership Exchange. States choosing this approach will maintain control over day-to-day management of Navigators and in-person consumer assistors, and will have the option to engage in some outreach, education and branding activities. Navigators and in-person consumer assistors will be the “boots on the ground” in states to help educate consumers about plan choices and coverage options. While Consumer Partnership states will oversee and provide technical assistance to Navigators, HHS will retain the ultimate authority over Navigator programs in states where FFEs will operate, including states implementing a Consumer Partnership.

As 2014 unfolds, it will be interesting to see which State Partnership Exchanges expand their Partnership responsibilities or pursue State-based Exchanges. At least one state, Illinois, has indicated their Consumer Partnership will be an interim step toward a State-based Exchange in 2015. Stay tuned.

Elizabeth Carpenter is Senior Advisor for McKenna Long & Aldridge LLP