On August 14, 2012, the Department of Health and Human Services (HHS) Center for Consumer Information and Insurance Oversight (CCIIO) released a final Blueprint for Approval of Affordable State-based and State Partnership Insurance Exchanges (the "Blueprint"). The Patient Protection and Affordable Care Act establishes Affordable Insurance Exchanges ("Exchanges"), which are state-based marketplaces that will provide individuals and small businesses with access to health insurance coverage beginning January 1, 2014. The Exchanges are meant to increase competition within the health insurance market — individuals and small employers can compare and purchase private health insurance options through the Exchanges, which should incentivize insurance companies to compete for business by, for example, keeping down costs.

CCIIO’s recently released Blueprint provides guidance to states about the application and declaration process involved with selecting an Exchange. Under the Affordable Care Act, states have choices in determining what type of Exchange will best suit the needs of its citizens, including choosing to operate as a State-based Exchange or a Federally-facilitated Exchange. Within a Federally-facilitated Exchange, a state may also opt for a State Partnership Exchange, in which a state may operate certain Exchange activities related to plan management and/or consumer assistance.

HHS must approve or conditionally approve State-based Exchanges or State Partnership Exchanges prior to January 1, 2013. Additionally, HHS must make a determination regarding whether a state will operate reinsurance and/or risk adjustment programs or instead opt for Federal government services for these activities. To begin the approval process for a State-based Exchange, a State Partnership Exchange, or reinsurance and risk adjustment programs, a state must submit information, or its own “blueprint,” that details how the state will meet all of the required aspects of the Exchange option it has chosen. States seeking to operate a State-based Exchange or electing to participate in a State Partnership Exchange must submit a complete Exchange blueprint to HHS by November 16, 2012 (for plan years beginning in 2014). HHS will begin plans to implement a fully federally facilitated Exchange in those states that do not submit the required documentation for state-run exchanges by the November 16 deadline. One notable difference in the final Blueprint released by HHS from an earlier draft version is that states must describe how they will implement an in-person assistance program, which will provide in-person assistance to consumers prior to the start of the Exchange program in 2014.

The Blueprint is available here.