Can the states and the federal government get the health insurance marketplaces that are supposed to sell health coverage to as many as 20 million Americans starting in October 2013 ready in time? That’s been an open question since the law passed in 2010. But in an interview with Bloomberg News yesterday, Louisiana Insurance Commissioner Jim Donelon suggested that it was time for the Obama administration to start considering an extension.
“It’s his calling-card, signature issue and to rush it into implementation before it’s ready would not be in his overall interest,” Donelon, a Republican and president of the National Association of Insurance Commissioners (NAIC), told Bloomberg. He also insinuated this was a widely held view, saying that state officials across the country “don’t want it to create chaos.”
According to a few people in the know, the U.S. Department of Health and Human Services (HHS) is taking those concerns seriously.
The department has already tacitly admitted that the timelines might need bending. Originally, states were supposed to have gotten full approval of their plans for a state-based exchange by Jan. 1, 2013, if they wanted one. But the Obama administration decided last year that states could ask for merely conditional approval instead, with the understanding that they would tweak their plans as necessary to get full approval at a later date. The feds also gave states until Feb. 15 to decide if they wanted to pursue a partnership exchange or default to a federal-run marketplace.
But even with those allowances, many state officials do share Donelon’s view: We might need even more time. An extension would have political complications, though. For one, if the Obama administration extended deadlines passed their statutory date, it would presumably validate earlier criticism that the law was unrealistic with its timeline.
One state official, who asked not to be named to discuss the issue candidly, said their state was already floating alternatives—such as selling coverage on the exchange that is retroactive to Jan. 1, 2014—that could allow for an extended deadline. The person, who has been in regular contact with HHS, also said they knew that the department was also weighing those kinds of options, even if officials wouldn’t say so publicly. HHS declined to comment for this story.
“At some point, the grown-ups are going to have to step in and say: ‘We have to figure out a way to do this, or a lot of people are going to get it hurt,’” the official said. “It's better not to have things fall apart when you're trying to meet an unrealistic deadline, when an extra three or four months could make a huge difference 40 years from now.”
The Affordable Care Act (ACA) has consistently faced criticism that its timetables were too aggressive. Under the law, the marketplaces (formerly known as ‘exchanges’) have to open on Oct. 1, 2013, to start selling insurance coverage that begins on Jan. 1, 2014. Given the amount of work that the states or HHS—which must establish an exchange in any state that chooses not to do so itself—must do to get them running, doubts have always lingered. They have to set a website, which is similar to Expedia or Orbitz, to process insurance applications, handle customer service and digitally communicate with various state and federal agencies to make sure everything checks out.
It’s a tall task, and the deadlines are rapidly approaching. But is there going to be an organized push for an extension? That remains to be seen. At a press briefing to introduce outgoing U.S. Sen. Ben Nelson (D-Neb.) as NAIC’s new CEO, the organization’s leaders started to walk back some of Donelon’s comments. Nelson, who was present at the Bloomberg interview, said that Donelon mentioned an extension as “one option” that would be available if necessary.
“At this point, the law is the law,” said NAIC president-elect and North Dakota Insurance Commissioner Adam Hamm. “We can’t control what’s going to happen here in Washington, D.C. As states, we need to work with what’s in front of us and not worry about any hypotheticals.”