An Interview with Joel Ario, Managing Director, Manatt Health Solutions

EDITOR’S NOTE: Before joining Manatt, Joel Ario served as director of the Office of Health Insurance Exchanges at the U.S. Department of Health & Human Services, where he led HHS efforts to develop the regulatory framework for Exchanges. He has spent 30 years helping to shape and implement public policy, including two decades devoted to leading health insurance reform efforts at the state and federal levels. In a recent interview with “Health Insurance Marketplace News,” Joel shared his firsthand perspective on how the concept of Exchanges has evolved—and what he’d like to see next. Following are some key excerpts.

How Has the Concept of Exchanges Changed over Time—and What Has Changed Most?

Joel’s Response: I first learned about Exchanges in 2003 when a Republican legislator in Oregon called me to his office to discuss a pro-Exchange white paper by the Heritage Foundation. By the time Governor Romney and a Democratic legislature passed their reform in 2006, I was actively promoting the same ideas in Oregon and was thrilled when the idea of Exchange marketplaces became a defining feature of the Affordable Care Act. It was the opportunity of a lifetime when I was asked to lead the federal office of Exchanges in 2010. I would still be in that job were it not for the fact that my wife and three boys were not buying another move for Dad’s career. So after 13 months of commuting from Hershey, PA to D.C., I came home to serve the cause in a bit more balanced way, though I have the good fortune of continuing to work with states and other key stakeholders as a managing director at Manatt Health Solutions.

The essential concept of Exchanges has not changed, and it will prevail. I am confident that most consumers will eventually purchase health insurance through public or private Exchanges--web-based Marketplaces where competition is fierce among sellers fighting for market share from consumers with the tools they need to compare choices and find the right products for their families. We won’t see the full power of the concept in 2014, but as the health insurance marketplace begins to resemble other web-based marketplaces, we will look back and wonder how we tolerated such an opaque market for so long. I don’t understand all the technologies, but I talk to a lot of entrepreneurs who are eager to reshape a three-trillion-dollar marketplace.

Exchange Marketplaces will come in a lot of flavors. The public Exchanges, which will dominate the individual market in 2014, will test all kinds of ideas--active purchasing vs. clearinghouse approaches, more vs. less standardization of products, etc. Private Exchanges, which already have a toehold in retiree and other niche markets, will grow their share of the group market. Some private models will look like the public Exchanges, with metal levels and risk adjustment. Other models will allow mega-employers to keep much of their current role in delivery system reform while experimenting with defined contribution roles. It won’t be too many years before most Americans will expect to be offered choices and accept the fact that some choices will cost them more than others.

The ACA promise of basic coverage for everyone, with no loopholes, is the foundation of reform, but it also is critical that we become more price-conscious. Increased cost sharing is not a new trend in the Marketplace, but Exchange Marketplaces will make the cost drivers in healthcare a lot more transparent and make it easier to find those that are delivering the best quality at the lowest price.

What Occupies a Typical Day?

Joel’s Response: My work with Manatt Health Solutions gives me a 360-degree view of the healthcare marketplace, since we have clients in every sector, from government to providers to payers. Having worked for both states and the federal government, I respect the federal role in establishing the rules of the road for the new marketplace, but I look to the states to be the real innovators, and I have done work for nearly half the states since joining Manatt. I also have worked for insurers, hospitals, employers and foundations and have gleaned some new perspectives that are not always shared with regulators. My favorite activity is still a robust off-the-record discussion on a tough implementation issue.

Where Should We Focus Next?

Joel’s Response: When I came to HHS in August 2010, I never dreamed that the partisanship would go on as long as it has. The opposition makes a tough job even harder, but the irony is that much of what the opposition is fighting -- Exchange marketplaces that empower consumers, states stepping up rather than ceding control to the federal government -- are bipartisan if not conservative ideas. The two political parties will always disagree about levels of subsidy and regulation, but I look forward to the day when the success story in Massachusetts is duplicated in California and across the country, and the stakeholders that I deal with are less distracted by politics and can focus their energies on making our health system work better.