Insurance Exchanges are On Track, Health Official Says

The Obama administration will meet an Oct. 1 deadline for setting up new state insurance exchanges, said a top U.S. health official who met skepticism from lawmakers at a congressional hearing today.

The exchanges, created by the 2010 U.S. health-care overhaul, are online marketplaces where people will be able to compare and buy government-subsidized insurance. Their scheduled implementation next year has been called into doubt because of the complexity of the law and opposition in some states.

“We are making progress, we are on track and we will be ready,” Gary Cohen, director of the Department of Health and Human Services consumer information division, told the Senate Finance Committee at a hearing in Washington.

Senator Orrin Hatch of Utah questioned how with only 16 states pledging to build exchanges, the federal government will be able to manage marketplaces for the remainder of the nation’s 50 states.

“I have a hard time understanding how the administration expects to have exchanges up and running by Oct. 1, especially when we have no details on how the exchanges will work in more than half the states,” Hatch, the ranking Republican on the finance committee, told Cohen.

Senate Finance Committee Chairman Max Baucus, a Montana Democrat, also questioned whether “archaic” computer systems at the Social Security Administration, Internal Revenue Service and Homeland Security Department will be able to communicate with one another by the time exchanges open for enrollment.

Cohen said his agency will complete testing of “the flow of data back and forth” between those agencies in the spring.

27 Million

The $1.3 trillion Affordable Care Act relies on governors to build a network of insurance marketplaces and expand Medicaid, the joint federal-state program for the poor. The number of Americans projected to gain insurance from the U.S. health-care law has already eroded, by at least 5 million people, to 27 million as the Obama administration grapples with Republican opposition.

At least 22 Republican governors have said they’ll refuse to participate in the health exchanges and a Supreme Court decision lets them also opt out of the Medicaid expansion.

The Obama administration has said before that it will run exchanges in states that aren’t building their own, and all marketplaces will be ready for enrollment by Oct. 1. The law requires most Americans to carry insurance beginning Jan. 1, 2014.

To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

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