Individual and Small Group Health Insurance Market Data for Health Plans, Hospital Accountable Care Organizations and Industry Analysts

Health Insurance Exchange – Carriers Face IT Systems Integration Problems

Health Insurance Exchanges are new markets created by initiatives as defined in US Health Care Reform. Two pieces of legislation are collectively referred to as the Affordable Care Act and outline Health Insurance Exchanges:

  1. March 23, 2010 – The Patient Protection and Affordable Care Act.
  2. March 30, 2010 – The Health Care and Education Reconciliation Act of 2010.

Section 1311 of the Affordable Care Act establishes Health Insurance Exchanges (Exchanges) and sets a milestone January 1, 2014 for the Exchanges to begin offering health care coverage.

The Vision of the Health Insurance Exchange

Health Insurance Exchange Integration For State Public and Private ExchangesThese government-based Exchanges will help individuals and small employers shop for, select, and enroll in private-sector health plans known as Qualified Health Plans (QHPs). The Insurers who offer QHPs must meet specific criteria and the plans they offer must include the Essential Health Benefits.

Exchanges envision making purchasing health insurance easier and more understandable. The IT systems of these Exchanges are required to support a simple, seamless identification of people who qualify for coverage through any of the State’s subsidized health care programs: Medicaid, Children’s Health Insurance Program (CHIP), the Exchange, or any other State-specific subsidized coverage. Coverage through the Exchange can be subsidized by either Advanced Premium Tax Credits (APTCs) or Cost-Sharing Reductions (CSRs).

Core Exchange Functions

At a high level, each Health Insurance Exchange will address six business functions and supporting services that are critical for facilitating the acquisition of health insurance by individuals:

  1. Plan Management
  2. Eligibility & Enrollment
  3. Financial Management
  4. Customer Service
  5. Communications
  6. Oversight

A State Level Integration Problem – Core Exchange Business Functions Require Integration

Each State has the opportunity to establish a State-based Exchange, subject to certification that it meets Federal standards. The deadline for certification is January 1, 2013. If a State does not achieve certification by the deadline, the State will default to the Federal-facilitated Exchange as required by the law.  Some States have expressed a preference for a flexible Federal-State Partnership model, combining State-designed and operated business functions with Federally-designed and operated business functions.

The Centers for Medicare & Medicaid Services (CMS) has been participating in a collaborative business analysis effort to create business blueprints that describe the goals for Exchanges and an operational view of Exchanges. These business blueprints consist of detailed definitions of business processes, business services, and supporting data necessary to support the implementation of the services for each of the Exchange business area.

The reality is that each core Exchange function will require real-time, bi-directional information exchange between the function stakeholders. Stakeholders include but are not limited to the following:

  1. Federal agencies
  2. State Agencies
  3. Insurance Carriers
  4. Employers

A Large Magnitude Integration Problem

Think about this from the Carrier perspective for a minute. Single state Carriers have a complex health insurance exchange integration problem in one state alone. If you are a carrier that operates in many states, what does your integration problem look like?

Oxlo Systems provides a free to downloadable white paper related to these problems and many more. Get the free white paper, “Rapid Adaptation Strategy for Integrating with Health Insurance Exchanges“, for more state public and private Health Insurance Exchange information.


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