As part of the Affordable Care Act (ACA or health care reform law), starting in 2014 ALL Americans much have a minimum amount of health insurance or be taxed by the government. The law also requires each state to have a health insurance exchange where people can buy health insurance coverage. People who do not get health insurance at work, or can not afford it, may be able to get it through an exchange. The exchanges do not replace buying health insurance privately. They are simply a new place to shop and buy.
Three exchange model options–
Exchanges can be set up in one of three ways. Each state determines how its exchange will be set up:
1 – State-run facilitator model – Any carrier meeting minimum federal and state requirements set for the health insurance exchanges can be in this exchange. Carriers compete in an open market.
2 – State-run active purchaser model – The state solicits bids from health insurance companies and determines which plans it will offer. The state directly negotiates the price and benefits offered.
3 – Federally run model – The U.S. Department of Health and Human Services (HHS) runs the exchange in states that choose not to create one.
