Rhode Island policymakers are hammering out the details of how to implement the health care reform bill Congress passed last March.
State Senate President Teresa Paiva Weed, D-Newport, introduced a bill Jan. 28 to establish a health care exchange in Rhode Island.
"The exchange will create a health benefit marketplace that is fair, competitive, transparent and understandable to individuals and small businesses," Paiva Weed said in a statement. "It will also have the important job of getting federal subsidies to the people who need them."
The health care reform law mandates that each state set up a health insurance exchange by 2014 or allow the federal government to create one if they refuse to comply. An exchange is a set of standardized health plans, offered by private insurers, from which individuals may purchase coverage. They are intended to inject competition into the marketplace, lower costs and extend coverage to those currently uninsured. Low-income citizens will receive federal subsidies to purchase insurance under the reform law.
At a January ceremony in downtown Providence, Gov. Lincoln Chafee '75 P'14 signed an executive order establishing the Rhode Island Health Care Reform Commission. He named Lt. Gov. Elizabeth Roberts '78, who once worked in the health care field and has long advocated for reform, as its chair.
"I really think the creation of this new entity … is really an exciting moment," Roberts said.
She said the exchange should address three critical issues — "affordability, quality and sustainability."
The commission will serve to make recommendations to the governor and offer legislative proposals to the General Assembly. It replaces a task force Roberts established earlier to investigate the problems facing Rhode Island's health care system. In that role, she clashed with former Gov. Donald Carcieri '65, a staunch federal reform opponent.
"We have been in the past a national leader in health care and health care reform," Roberts said. "That has not necessarily been our position over the past few years, but I think it will be a real goal of this group and this administration to put us back in the forefront."
Deborah Faulkner, a consultant to the Rhode Island Office of the Health Insurance Commissioner, served on Roberts' task force and will play a role on the new commission as well.
"It will create a shop exchange — that is, a place for small employers to identify options for health insurance and potentially purchase through it," Faulkner said.
There are many questions over how the exchange will operate — what authority it will have, which plans will be offered and who will be allowed to participate. Other remaining questions include whether it will be sustainable, how it will interface with the state's Medicaid program and which state government agency will be responsible for overseeing it, Faulkner said.
"Does (the reform law) go beyond what's envisioned in the (Affordable Care Act) to serve beyond small groups, larger groups, municipalities?" she said. "Those are the kinds of questions that many folks have raised. Who are its primary customers?"
John Robitaille, a Republican who narrowly lost the race for governor last year, said the health care law's requirement that individuals purchase insurance is unconstitutional.
"You can't require people to purchase a product," he said.
Had Robitaille won, however, he would have been charged with implementing the law. He said he would like the exchange to provide consumers with information about different insurance options. He added that he hopes it does not become a bureaucracy, preferring instead something like a website.
He also said the law hurts businesses by driving up health care costs.
"I've spoken with small business owners who say they can't hire new employees because of this," Robitaille said.
But Ted Almon, president and CEO of Claflin, a Warwick-based medical device company, said exchanges will benefit small businesses.
"The exchange opportunity provided in the federal legislation is perhaps the most significant opportunity that we've had to really bend the cost curve in the future of health care," Almon said.
He said the exchanges will make providing insurance affordable for businesses, while giving workers additional flexibility.
"Small business, ultimately, through the use of this tool, will be able to make a defined contribution on behalf of their employees — but their employees would then be able to use the exchange to select appropriate coverage within that budget," he said.
Almon said he thinks the exchange itself should be simple and user-friendly. He said the General Assembly should focus on the exchange's structure and authority, without getting into operational details.
Also last month, freshman state Rep. Daniel Gordon, R-Little Compton, Portsmouth and Tiverton, introduced a bill that would prevent the government from requiring Rhode Islanders to purchase insurance and from levying a fine if they refuse to do so, thereby nullifying a key component of the reform law known as the individual mandate. Under the federal Supremacy Clause, states cannot nullify federal law.
Challenges to health care reform's individual mandate are pending in federal court and will likely go before the Supreme Court.