6 Months Out – Will Federal Insurance Exchanges Be Ready?

By Robert Laszewski

As the Obama administration continues its top secret effort to build federal insurance exchanges in about 34 states while 16 states are doing it on their own ,(Will Federal Exchanges Be Ready)  that continues to be the big question.

HHS is using IT consulting firm CGI for much of the work on the exchanges and the federal data hub. CGI has their plate full since they are not only working on the federal exchange but also doing work for the state exchanges in at least Colorado, Vermont, and Hawaii.

Earlier this month, the Senate Finance Committee held an oversight hearing. The Obama guy in charge of exchange development testified before them. I thought it was notable that it was the Democrats who expressed the greatest concern, and frustration, over senators not getting a clear idea for just where the administration is toward the goal of launching the new health insurance exchanges on October 1.

I thought the following Reuters quote was telling:

“I am absolutely confident that every state will have an exchange that will be functioning and ready, said Gary Cohen [HHS executive in charge of the effort], who declined to elaborate on the number and identity of states that could be in for difficulties.”

He wouldn’t elaborate on just where there might be problems? Why? Why does the administration have to be so secretive?

This lack of transparency has the health insurance industry––the people the feds are going to have to connect with––very worried.

In early February, information technology consultant Edifecs, which provides health care software services to health plans, hospitals, and other organizations, held a “Compliance Summit” for 125 executives from hospitals, clearing houses, state health insurance exchanges, and health plans. The audience included executives from 34 different health plans. I gave the conference’s opening keynote speech.

These are the industry executives that the state and federal exchanges are working with day-to-day. So, if you want to get the perspective from those in the trenches with the state and federal health insurance exchanges (HIXs) on whether they’ll be ready, this is a pretty good group to ask.

Edifecs did just that using interactive software in the room to get the audience’s response to a number of questions.

The input from the marketplace doesn’t inspire confidence:

  • The vast majority of those who attended are planning to participate in the new health insurance exchanges.
  • They are worried that, with the feds and states getting such a late start in detailing requirements and with so little time left, that their own organizations can be ready.
  • They are also worried because the information they are getting from the health insurance exchanges in order to do their share of the work is poor, to very poor.
  • They are not optimistic that the government-run exchanges will be ready on time.
  • Almost all of those surveyed are concerned that the exchanges have not involved them as users in gaining input from the industry––traditionally a very bad sign in system development.
  • And, the executives are very concerned about being able to reconcile billing and eligibility information from the exchanges.

From the Edifecs survey:



Robert Laszewski has been a fixture in Washington health policy circles for the better part of three decades. He currently serves as the president of Health Policy and Strategy Associates of Alexandria, Virginia. You can read more of his thoughtful analysis of healthcare industry trends at The Health Policy and Marketplace Blog, where this post first appeared.