Gov. Tom Corbett gave approval to develop a state-based health insurance exchange for small businesses and individuals, the Pennsylvania Insurance Department announced on Tuesday.
The department over the summer held three public forums to discuss the possibility of an exchange, with more than 800 attendees. The large majority of health care providers, insurers and community representatives at the forums said they supported Pennsylvania creating its own health insurance exchange, according a report by the department and auditing firm KPMG.
The Insurance Exchange Planning Overview report said it analyzed federal regulations, reviewed public comments and considered information on health care reform and its implementation. The department also conducted two online surveys to collect feedback for the decision.
Health insurance exchanges are mandated by the Patient Protection and Affordable Care Act signed into law on March 23, 2010, by President Barack Obama. States are given the option to design their own exchanges or default to a federal system. The exchanges are to be operational by Jan. 1, 2014, according to the law.
A health insurance exchange is loosely defined as an online store where people can compare and shop for health insurance. The exchange will be available to people working for businesses with 100 or fewer employees and for individuals who are self-employed, unemployed, not covered by their employer or retired and not yet eligible for Medicare, according to regulations. States may choose to reduce the small businesses eligible to 50 employees or less for the first two years.
New Jersey-based KPMG estimated a range of participation between 2 million and 2.2 million people could participate with the Pennsylvania health insurance exchange in 2014, according to the report.
The next steps for Pennsylvania are to apply for a federal grant to develop the exchange while continuing to regulate the state’s health insurance market, the department said. It also will consider public input, as well as legal and budget impacts, while working with the General Assembly to develop legislation for putting the exchange in place, according to the department.