NARRAGANSETT—Rhode Island Governor Lincoln D. Chafee signed an Executive Order on Monday establishing the Rhode Island Health Benefits Exchange, a program through which uninsured individuals and small businesses can shop for the best deal among a multiple number of health insurers.
“The Exchange will give more Rhode Islanders access to affordable health coverage,” said Governor Chafee. “There are still many decisions to be made about the specific details of how the Exchange will work. I am confident that Attorney Curran and the Board will ably guide the best design for a Rhode Island exchange.”
Scheduled to begin enrolling for health insurance by late 2013, the Exchange aims to make health insurance reliable and affordable for all Rhode Islanders. Rising health care costs and confusion caused by large amounts of legal paperwork have often trapped those who are in need of health insurance. Small businesses, families, and individuals who are looking for health insurance or want an alternative to any employer-based insurance can use the Exchange as a resource.
“The focus of the Exchange is on small business,” said Insurance Commissioner Chris Koller. “Small businesses want another option for more carriers and plans. Currently it is very hard to find that information and the Health Exchange will simplify the process.”
“Today, the Governor took a major step in fundamentally changing the status quo for how Rhode Islanders purchase health coverage,” said Lieutenant Governor Elizabeth Roberts, Chair of the Rhode Island Healthcare Reform Commission. “More importantly, the purchasing power of individuals, families and small businesses will be brought together in a way that will allow real changes to be made to start to moderate the sharp increases in the cost of health care.”
Health insurers who participate in the Exchange will also receive subsidies from the federal government, which in turn will mean subsidies for small business and individual purchasers. Those who are afraid to switch from their employer-based health insurance although coverage is inadequate will now be able to rely upon the Exchange for easy access to affordable alternatives.
“Fifteen thousand people now with no employer-based insurance are covered individually,” said Koller.” With the Health Exchange, we expect that number to jump up to 70,000. It will be a bit like Travelocity; a place to go for individuals to get the best health care plan they can.”
The Exchange, created under the Patient Protection and Affordable Care Act, will be fully backed by federal funds which will be applied for at the end of September.
Using federal funding ensures that the Exchange will not be subject to budgetary constraints. The Executive Order will tap an already existing fund in the Department of Health for the initial financing of the Exchange.
“Funding [for the Exchange] is written into statute, and it is more stable than a budget appropriation,” said Koller. “What most people pay attention to is the likelihood of federal actions, such as a new administration, that would result in a change of legislation.”
The Rhode Island Health Benefits Exchange will also be placed under the direct purview of the Executive Department in the state government. Such action allows for a more consistent harmonization of Exchange policies with changing state and federal health care regulations, and is also a signal that Governor Chafee is determined to see the Exchange succeed in the long term.
“The advantage is it indicates that the Exchange is a priority of the governor,” said Koller. “[By placing the Exchange under the Executive Department], it will not compete with existing priorities. It is a workload issue. If you put the Health Exchange into an existing agency, such as the Department of Health, it will add more to what that agency already has to do.”
An Exchange Board has been formed which will oversee the administration and delivery of health care insurance to Rhode Islanders. The public members of the Exchange Board appointed by Governor Chafee himself are: Margaret Curran, Former United States Attorney, Michael C. Gerhardt, Former Health Insurance Executive, Interim Executive Director for Rhode Island agencies in transition, James Grace, President & CEO of InsureMyTrip.com, Linda Katz, Policy Director and Co-Founder of The Poverty Institute, Peter Lee, President and CEO of the John Hope Settlement House, Pamela McKnight, MD, Donald Nokes, President and Co-Founder of NetCenergy Tim Melia of the United Food and Commercial Workers New England Council, and Minerva Quiroz, Case Manager for the AIDS Project Rhode Island.
The board will also seat four governmental members; Steven Costantino, Secretary of Health and Human Services, Christopher Koller, Health Insurance Commissioner, Richard Licht, Director of Administration, and Michael Fine, MD, Director of Health.
The Executive Order includes a strict conflict of interest provision for Board members and also creates an advisory council which will utilize the expertise of insurers, brokers and medical providers, who are otherwise prohibited from board membership. The hope is that their knowledge of the health insurance industry can act as a guiding hand for the Exchange’s design and planning process.
“Governor Chafee, Lieutenant Governor Roberts and many Rhode Islanders have laid the groundwork for the Rhode Island Exchange to succeed in making it easier to for Rhode Islanders to get affordable health coverage,” said Curran, Chair of the Exchange Board. “I look forward to getting to work putting together the best exchange to serve the needs of Rhode Island families and small businesses.”
The Exchange Board will be convening in the near future, although a definitive date has yet to be named.