insurance

R.I. Benefits Exchange gets $58M in new federal funding

BLOOMBERG NEWS FILE PHOTO ANDREW HARRER
FILE PHOTO: “For years, Americans have known that our health insurance market is broken,” said Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, in announcing the awards.
Posted 11/29/11

WASHINGTON - Rhode Island received $58 million in new federal funds to help to build the infrastructure for its health insurance benefits exchange, the U.S. Department of Health and Human Services announced Tuesday.

Rhode Island is the only state to apply for and receive a Level Two grant, which provides multi-year funding, officials said. Twelve other states received Level One planning grants for health insurance exchanges totaling about $162 million.

The $58 million, which will flow through the R.I. Department of Business Regulation, will be used to support the development of the exchange’s IT infrastructure, a consumer support structure, reporting and evaluation, and staffing.

“For years, Americans have known that our health insurance market is broken,” said Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, in announcing the awards. “Too many Americans have been priced out or locked out of the system.”

Now, as a result of the creation of health insurance exchanges at the state level, she continued, small businesses and families will have a marketplace that offers them affordable health insurance options.

“We need a health insurance marketplace that works for American families, not big insurance companies.”

Rhode Island’s leadership on health care reform received praise from officials.

“Rhode Island has been at the forefront of health care innovation,” said Chiquita W. Brooks-LaSure, director of coverage policy at HHS.

The new installment of funds is a direct result of Gov. Lincoln D. Chafee’s executive order on Sept. 19 to create the R.I. Health Benefits Exchange. As a result, Rhode Island was able to meet the federal grants deadline for the latest round of funds.

Rhode Island applied for a total of $74.5 million over three years to fund the development, design and technology of its exchange, but only received $58 million. The difference, according to Brooks-LaSure, was a result of what she termed “rigorous” evaluation and “adjustments that are part of normal budget negotiations.” The shortfall should not be a problem, according to R.I Health Insurance Commissioner Christopher F. Koller, who said: “We have identified efficiencies to make it work.”

The new exchange will serve as an online marketplace of Rhode Island consumers to research options and purchase health insurance plans. About 170,000 Rhode Islanders are expected to use the exchange to purchase health insurance, according to Koller. Another 180,000 Rhode Islanders are expected to use the exchange to determine eligibility for health care services under Medicaid.

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