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NEWS - Exchanges, Exchanges Everywhere: Understanding the role of Private Exchanges

David Blumenthal, President, The Commonwealth Fund

January 28, 2014 – Just when we thought we’d gotten the health insurance exchange part of the Affordable Care Act (ACA) down, along comes a curve ball: private exchanges.

We knew about public exchanges (or marketplaces): 14 run by states and the District of Columbia, 36 run by the federal government alone or in partnership with states. We knew they aim to provide opportunities for uninsured and individually insured Americans to get coverage under Medicaid or through private insurance policies. And we knew that eligible consumers (with incomes under 400 percent of the federal poverty level [FPL] but above 138 percent of FPL) can receive federal subsidies for the purchase of private health plans on public exchanges.

We also knew about public exchanges that are just for small employers (fewer than 50 employees), so-called Small Business Health Option Programs (SHOPs). (These aren’t ready electronically everywhere yet, but they will be by November 2014.) If they work as planned, they could offer employees of small businesses a wider range of health plan choices than many have had before.

That’s a lot of exchange stuff to get under our belts, without even considering private exchanges. So what are these other exchanges? How, if at all, do they relate to the ACA? What should we make of them?

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