The pandemic provided a real-life example of how operating a state-based exchange provides a state with the flexibility it needs to best serve its constituents and balance the needs of all stakeholders in an insurance market. While the Special Enrollment Periods (SEP) are a very timely and clear illustration of today’s state-based marketplace platforms providing states with policy flexibility, there are additional reasons states should consider the transition from the federally facilitated marketplace (FFM) to a state-based exchange (SBE).
Special Enrollment Period Flexibility
During the early days of the pandemic in the Spring of 2020, 12 of the 13 (at the time) state-based exchanges chose to open a special enrollment period when the federal government would not. For those that did open an SEP, the enrollment windows varied. Uninsured consumers who did not enroll in a health care plan during the 2020 open enrollment period (which took place in the fall of 2019) were able to do so during the SEP.
Fast forward to 2021. According to the Kaiser Family Foundation, about 9 million uninsured Americans would qualify for premium assistance under the Affordable Care Act (ACA). In an effort to encourage more of the nation’s uninsured to enroll in a health insurance plan, the Biden Administration opened an SEP on the federal level (via healthcare.gov) from February 15, 2021 and through May 15, 2021. As expected, all state-based marketplaces followed suit. Due to local state policies and needs — and the freedom to address them as they see fit — many of these states’ windows have some small variance, while states such as Connecticut and Idaho chose to open just a limited 30-day SEP.
Regardless of whether or not the federal government is running a special enrollment period, a state-based exchange can determine its own SEP policies.
Open Enrollment Period Flexibility
In the same way a state can decide how long its SEPs will be, it also has the flexibility to decide how long the annual open enrollment period will run. Since 2016, the federal open enrollment period has been from November 1st – December 15th. While many do, SBEs do not have to stay within those parameters. Some examples of 2021 enrollment dates:
| wdt_ID | State | OEP Start | OEP End |
|---|---|---|---|
| 1 | California | October 15, 2020 | January 31, 2021 |
| 2 | Minnesota | November 1, 2020 | December 22, 2020 |
| 3 | Nevada | November 1, 2020 | January 15, 2021 |
| 4 | New Jersey | November 1, 2020 | January 31, 2021 |
| 5 | Pennsylvania | November 1, 2020 | January 15, 2021 |
Each state knows its health insurance markets – insurance carriers, assisters and brokers, commercial group and individual plans, as well as the uninsured populations, and can put forth policies that best serve consumers regardless of how the federal government is running its OEP.
Policy and Market Control
States operating an SBE, or are planning to operate one, are taking back control of their health insurance markets. With 1332 waivers, states can find ways to be creative with funding by, for example, setting up reinsurance pools in order to lower premiums in the state. SBEs can also make policy decisions such as opting out of Small Business Health Options Program (SHOP) programs and offer other, more flexible programs to support small business health insurance. A state-based exchange allows a state to set its own policies with less federal government involvement and without reliance on healthcare.gov.
A state-based exchange allows each state to run its health insurance market as it sees fit.
