Pennsylvania is rolling out its new “Pennie” this fall: a state-run insurance exchange that officials say will save residents collectively millions of dollars on next year’s health plan premiums.
Since the Affordable Care Act’s marketplaces opened for enrollment in fall 2013, Pennsylvania, like most states, has used the federal www.healthcare.gov website for people buying coverage on their own.
But in a move defying the usual political polarization, state lawmakers from both parties last year agreed the cost of using the federal marketplace had grown too high and the state could do it for much less. They set up the Pennsylvania insurance exchange (nicknamed “Pennie”), designed to pass on expected savings to policyholders. Although the final rates for 2021 are not yet set, insurers have requested about a 3% average drop in premiums.
Pennsylvania is one of six states shifting in the next several years from the federal insurance exchange to run their own online marketplaces, which determine eligibility, assist with enrollment and connect buyers with insurance companies. They will join 12 states and the District of Columbia with self-contained exchanges.
The transitions come amid mounting evidence that state marketplaces attract more consumers, especially young adults, and hold down prices better than the federal exchange. They’ve also been gaining appeal since the Trump administration has cut the enrollment period on healthcare.gov and slashed funds for advertising and helping consumers.
State policymakers say they can run their own exchanges more cheaply and efficiently, and can better respond to residents’ and insurers’ needs.
“It comes down to getting more bang for your buck,” said Rachel Schwab, a researcher at Georgetown University’s Center on Health Insurance Reforms in Washington, D.C.
The importance of state-run exchanges was highlighted this year as all but one of them held special enrollment periods to sign up hundreds of thousands of people hurt financially by COVID-caused economic turmoil. The federal exchange, run by the Trump administration, refused to do so, although anyone who has lost workplace insurance is able to buy coverage anytime on either the state or federal exchange.
Like Pennsylvania, New Jersey expects to have its state-run exchange operational for the start of open enrollment on Nov. 1.
In fall 2021, New Mexico plans to launch its own marketplace and Kentucky is scheduled to fully revive its state-run exchange, which was dismantled by its Republican governor in 2015. Maine has also announced it will move to set up its own exchange, possibly in fall 2021.
Virginia’s legislature passed an exchange bill this year and hopes to start it in 2022 or 2023.
Source: KHN