Making Sure The Health Insurance Exchange Works for Arkansas Families

The Patient Protection and Affordable Care Act (ACA) requires states to have a health insurance “Exchange” that will provide high-value and affordable coverage for consumers, including individuals and small businesses, in place by 2014. The Exchange will be a marketplace where Arkansans can go to enroll in private insurance plans and, for those with income up to 400 percent of the federal poverty level (about $89,000 for a family of four), receive subsidies based on their income. The Exchange will also serve as a doorway for individuals and families to enroll in Medicaid or ARKids First if they qualify. This marketplace should empower consumers by giving them the information and tools they need to make the best choices for their health and budget.

States have had the opportunity to choose to operate an Exchange on their own or partner with the federal government to run the Exchange in the state. Arkansas abandoned efforts to establish a state-based Exchange after the legislature failed to pass a law enabling the creation of one. However, Governor Beebe is supporting and advocating for establishment of a Federally-Facilitated Exchange (FFE) Partnership Model for Arkansas. With this model, Arkansas will oversee the Plan Management and Consumer Assistance functions for the FFE, while the federal government will manage the remainder of the Exchange. In April 2012, the legislature appropriated a $7.7 million federal grant to the Arkansas Insurance Department (AID) for FFE Partnership planning for these two components.

Projections show that approximately 211,000 Arkansans will enroll in health plans through the Exchange in 2014, with another 170,000 more taking advantage of a newly expanded Medicaid program. This will give scores of uninsured Arkansans access to affordable health coverage that they cannot access today. While the state has lost some control by not choosing to operate a state-based model, Arkansas families will need the same things from an Exchange regardless of who is ultimately responsible for managing it. The state should aim to retain as much influence as possible over the mechanics of the Exchange through the Partnership in order to ensure that it works for Arkansans.

The U.S. Department of Health and Human Services (HHS) issued final regulations governing the Exchange in March 2012. While the regulations do not specifically address how a Partnership Exchange will function, most of the rules will apply to the Arkansas Exchange. Following are recommended principles that to guide Exchange development through consumer participation, the Consumer Advisory and Plan Management workgroups, and decisions that will impact the success of the federal exchange. These elements are critical to developing an Exchange that meets the needs of Arkansas’s children and families.