Show Coverage: AHIP analyzes the exchange atmosphere

Managed Healthcare Executive brings you three days of onsite coverage from Institute 2011 in San Francisco, including today’s “Preparing for Exchanges” educational conference. Creating strategies to address the emerging exchange models remains a monumental challenge for managed care, and according to experts, the states are taking a variety of approaches.

“We think managed care has a critical role to play,” said Cathy Gallagher, AHIP vice president. “As a nation, we can’t walk away, but we have to make this manageable.”

Legislation to establish state exchanges has passed in:
• California
• Colorado
• Maryland
• Massachusetts
• Utah
• Vermont
• Virginia
• Washington
• West Virginia

"The majority of the activity is going on in the grant space because it's government funded," said Leanne Gassaway, AHIP senior regional director of state affairs.

Three states-Florida, Louisiana and Oklahoma-have returned their federal grant money, while Alaska never accepted the grants at all. Such states are opposing the Patient Protection and Affordable Care Act, thus choosing to forgo the associated support funding for the groundwork to create their exchanges.

California is considered a "pacecar" for the rest of the nation because it has already passed legislation and is creating a board to govern its exchange. Board members will be experts who are not involved with any other public program or entity and are separate from any health industry organization.

Health plans will only be able to participate in California's exchange through competitive bidding and selective contracting. According to Gassaway, managed care industry leaders are opposed to such a process. Likewise, funding for the exchange ultimately will come from assessments on insurance carriers selected to participate.

"We need to make sure we do it right," she said, noting the goal of making premiums affordable in the exchanges.

Ron Jackson, the assistant commissioner of the Georgia Department of Insurance, said that his state is in the process of a court battle over the constitutionality of the health reform law, and the prognosis is uncertain.

He said he doesn't see much opportunity for regional, collaborative exchanges among several states because of the infrastructure logistics.

"Regional exchanges from soup to nuts didn't make a lot of sense," he said. "Politics is local. Healthcare is local, too. Maybe some IT collaboration might be possible."