Red states also get health care nod from Obama

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By Ricardo Alonso-Zaldivar
The Associated Press

Injecting a rare shot of bipartisanship in the nation’s contentious health care overhaul, the Obama administration Thursday cleared four Republican-led states to build their own consumer-friendly insurance markets.

With open enrollment for millions of uninsured Americans less than 10 months away — Oct. 1, 2013 — the four GOP-led states are part of a larger group totaling 17 states plus Washington, D.C., that have gotten an initial go-ahead to build and run insurance exchanges.

Insurance exchanges are not a term that most consumers are currently familiar with.

The new marketplaces are supposed to take the confusion and anxiety out of buying private health insurance for individuals and families who purchase their coverage directly.

Exchanges are meant to have the feel of an online travel site, an Expedia or Orbitz.

But there’s one major difference: They will also offer some relief from sticker shock.

Under President Barack Obama’s health care law, about 8 in 10 customers in the new marketplaces will be eligible for federal aid to help pay their premiums.

Small businesses will have separate access to their own exchanges.

The GOP-led states conditionally approved Thursday are Idaho, Nevada, New Mexico, and Utah. A fifth, Mississippi, may yet win approval, but the administration’s decision is complicated by a dispute between Republican state officials. The governor does not want to participate, while the insurance commissioner does.

The federal government will set up and run the new marketplaces in states that opt out of playing any role, and 19 Republican-led states have taken that route.

The rest are either pursuing partnerships with Washington or still mulling options. On Thursday, Arkansas got its initial approval to run a partnership, meaning the state will handle consumer issues and oversee health insurance plans while Washington handles the back-office tasks of enrolling consumers and verifying if they are eligible for subsidies. Delaware had earlier received approval for its partnership exchange.

“In ten months, consumers in all 50 states will have access to a new marketplace where they will be able to easily purchase affordable, high quality health insurance plans,” Health and Human Services Secretary Kathleen Sebelius said in a statement.

They were originally a Republican idea that won bipartisan support, only to be abandoned by many in the GOP once Obama incorporated the concept in his health care law.

The basic idea is that setting up a marketplace with clear-cut rules would benefit consumers and encourage insurance companies to compete, helping keep costs in check. Former Massachusetts Gov. Mitt Romney set up an exchange in that state under his 2006 health care overhaul law. And Utah has already launched one that caters to small businesses.