On March 12, 2012, the U.S. Department of Health and Human Services (HHS) released the long-anticipated Final Rule and Interim Final Rules (the “Rules”) on the Patient Protection and Affordable Care Act’s (ACA) state health insurance exchanges (“Exchange(s)”), a key element of President Obama’s healthcare reform plan. Set to go into effect on January 1, 2014, the goals of the Exchanges are to enhance competition, improve availability of affordable health insurance options and allow small businesses the same purchasing power that large businesses currently enjoy. As described in the Rules, the Exchanges will operate as competitive marketplaces, allowing individual consumers and small businesses to directly compare pricing and quality of health insurance options, among other factors.
The Final Rule incorporates two proposed rules originally published in mid-2011 that together implement what HHS refers to as the Exchange establishment and eligibility rules that address the eligibility, enrollment and plan function of the Exchanges. Affording substantial discretion to states in the design and operation of the Exchanges, the Final Rule details minimum federal standards for the establishment and operation of the Exchanges, minimum standards that health insurers must meet in order to participate in the Exchange and offer a qualified health plan, and standards of participation for the Small Business Health Options Program.