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States: Wait-and-see on health exchange?

An NYT article today takes a look at the progress states are making to set up health benefit exchanges under the federal health law.  These exchanges are where people who don’t get their health insurance through their work and small businesses (and members of Congress) can compare private plans and buy health coverage.

In NC, the exchange law – basically written by the insurance industry – passed the NC House, but stalled in the NC Senate.  Will NC pass a consumer-friendly exchange law this year?  Like many states countervailing forces are in play.  More conservative Republicans may not want to join in implementing a key part of the federal health law but not doing so means the federal government will set up the basic NC exchange.  Insurers would like a state-run exchange but are struggling with their desire to design the exchange completely on their own terms or allow some basic consumer oversight.  Prospects in NC’s General Assembly are unclear, but we are in the same boat as other states:

Many states are waiting for a Supreme Court decision or even the November election results, to see whether central elements of the new law might be overturned or repealed. But that will be too late to start work. By Jan. 1, 2013, the Obama administration will decide whether each state is ready to run its own exchange or whether the federal government should do the job instead.

In another curious twist, insurance companies, which battled Mr. Obama over health care in 2009 and 2010, are now urging state officials to set up exchanges. They generally prefer state regulation, and they stand to gain because the United States Treasury will send subsidy payments directly to insurers on behalf of low- and moderate-income people who enroll in health plans offered through an exchange.

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