States that are planning to create their own health insurance exchanges had until Friday, December 14, to announce their plans. However, the Obama administration reported that thus far only 17 states have announced their intentions to run their own health exchanges, as reported by the New York Times [6]. Under the Affordable Care Act, state health exchanges must be up and running as of January 1, 2014.

WhiteHouse.gov [7] describes health exchanges as “an insurance marketplace that lets individuals and families without coverage and small business owners pool their resources and increase their buying power to make insurance more affordable.”

It is hoped that exchanges will spur competition between insurance companies and, thus, drive down insurance costs. The Congressional Budget Office estimates that 25 million people will eventually receive coverage through the exchanges, the Times reported.

On December 14, New York and Kentucky won conditional federal approval for their state-based exchange plans, and on December 10 preliminary approval for plans in Colorado, Connecticut, Maryland, Massachusetts, Oregon, and Washington was granted by Secretary of Health and Human Services Kathleen Sebelius.

Seven additional states are creating Partnership Exchanges in which the states and the federal government divide obligations, as reported by Forbes [8]. In a Partnership Exchange, Forbes writes, the federal government essentially performs all functions of exchange management except customer service and plan management. However, states have the choice to take responsibility for only one or both of those functions, Forbes noted.

The federal government will be responsible for creating exchanges in states that do not create their own exchange or a partnership exchange.

Consumers will be able to enroll in Health Exchanges beginning October 1, 2013, for coverage starting on January 1, 2014.

States that have stated they are implementing a state-based exchange are California, Colorado, Connecticut, Hawaii, Idaho, Kentucky, Maryland, Massachusetts, Minnesota, Mississippi, New Mexico, New York, Oregon, Rhode Island, Utah, Vermont, and Washington, according to the Henry J. Kaiser Family Foundation website [9].

The seven states planning for a Partnership Exchange are Arkansas, Delaware, Illinois, Iowa, Michigan, North Carolina, and West Virginia, the Kaiser Family website reported.