Newspaper article The Christian Science Monitor

Health Care Reform Bill 101: What's a Health 'Exchange'?

Newspaper article The Christian Science Monitor

Health Care Reform Bill 101: What's a Health 'Exchange'?

Article excerpt

The health care reform bill calls for each state to set up an 'exchange,' or marketplace, where people not covered through their employers would shop for health insurance at competitive rates.

The healthcare reform bill would require most people in the US to buy insurance. It would help some of them pay for it, too, with subsidies for lower- and middle-income individuals and families.

We talked about these topics in the first and second installments of our "in plain English" series on healthcare reform.

The legislation also would set up new places to shop for health insurance. They would be called "exchanges," and they're the subject of this piece.

Not everyone could use exchanges, and they won't be open for some time. But they're an attempt to inject some retail competition into a marketplace that today is not exactly teeming with bargains.

Theoretically, they'd allow individuals and small businesses to band together and get better prices and more variety in health insurance options - the kinds of breaks that big corporations can negotiate for their employees today.

How would they work? Would they be actual stores, in a mall, next to Hot Topic? Would they be Internet sites, or toll-free phone lines? What?

They would at least have to have call centers. So you could try to get them on the phone. But for the most part, they're design is up to the states.

How many exchanges would there be?

The House's original version of healthcare reform would have created a national exchange, but that particular bill is gone with the wind. Instead, the reform that's now on the edge of passage (or defeat, who knows?) would have states set up health option exchanges administered by either a government agency or a nonprofit organization.

The federal government would provide states with start-up money for exchange establishment. The exchanges are supposed to be open for business by 2014. If a state declines to open one, Uncle Sam can step in and open an exchange himself.

Who will the customers be? Not you, if you work for a medium or large company, and if your employer offers health insurance benefits. That sort of arrangement is grandfathered in, according to the legislation, and can continue pretty much as before. …

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