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Relief for balky health exchanges

By Jay MacDonald · Bankrate.com
Tuesday, March 4, 2014
Posted: 6 am ET

Lost amid all the fist-pumping that surrounded the successful re-launch of the federal government's HealthCare.gov last December has been the unfortunate reality that many state-built health insurance exchanges still don't function properly.

HealthCare.gov's failure to launch was front page news for good reason: It serves as the default health exchange for 36 states that passed on the option to build their own. And while it was a relief that version 2.0 was ultimately able to sign up 4 million and counting in recent months, the ongoing struggles of the other 14 state-run online marketplaces have garnered far less attention nationally.

Bending another Obamacare rule

That changed late last week when the Health and Human Services Department reassured those states that residents who were unable to obtain insurance through their state exchange due to technical problems and instead purchased coverage on the private market would still be eligible for federal tax credits. The four states with the poorest-performing exchanges include Hawaii, Maryland, Massachusetts and Oregon.

The new policy broke with the well-publicized selling point of Obamacare, which stated that those tax credits were available only to Americans who signed up for health insurance through a public exchange.

The word came as great relief to Oregon Democratic Gov. John Kitzhaber, who proposed the move to Health Secretary Kathleen Sebelius to relieve deadline pressure on his constituents who've been frustrated by flaws in the still-unfinished Cover Oregon exchange.

"I applaud the federal government for its efforts to make this financial assistance available for more Oregonians," Kitzhaber said in a statement. "Today's news means that many more Oregonians will be able to access better coverage at a more affordable cost."

Inviting more criticism

While his sentiments were echoed by Democratic leaders in Hawaii, Maryland and Massachusetts, the announcement may not sit well with Republican governors who not only refused to set up state exchanges but continue to call for repeal of the Affordable Care Act, four years after it became the law of the land.

Federal tax subsidies are designed to make health insurance affordable for lower-income individuals and families. Under the Affordable Care Act, most Americans must purchase health insurance by March 31 or face a tax penalty.

Follow me on Twitter: @omnisaurus.

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1 Comment
john
March 05, 2014 at 4:40 pm

Its not affordable under these conditions: If you live in a state that chose NOT to expand Medicaid, AND you make less than 11,500 dollars a year AND are a single person with no kids AND you do have a job. Ie: Single, part time workers who live under the poverty line in 18 states that chose NOT to expand Medicaid are forced to pay 100% of the insurance cost and receive no tax deductions or subsidies. Mrother is in that position and to get a silver quality insurance it would cost 38% of his entire year's worth of pay to pay for...He chose to go with no insurance and take the $100.00 tax hit, which is a shame. The Affordable Care Act is a joke for many.

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