Phone Icon
Call now to speak with a Licensed agent (866) 954-1892

Virginia Health InsuranceIndividuals and Families

Insurance Type:

Health Insurance Exchanges under the Patient Protection and Affordable Care Act in Virginia

On March 23, 2010, President Barack Obama signed the Patient Protection and Affordable Care Act. A health reform enacted since the Medicare and Medicaid stipulations of years long past, this new decree primarily aims to make health care more affordable to the people such that every American will eventually become insured. The government has then directed each state to plan a health insurance exchange where their residents can purchase reasonably priced insurance and get wider coverage too. If the state fails to have their health insurance exchange approved, or decides not to run the exchange, then the federal government will manage the exchange once it opens on January 1st 2014. The state can re-evaluate their position should they choose to run the exchange later on; this can be done yearly. Alternatively, states can choose to partner with the federal government in running the exchange.

The state of Virginia initially planned to have a state-run exchange. This was expressed when Virginia's Governor, Republican Bob McDonnell, signed into law House Bill 2434. This legislation was passed following the recommendations of the Virginia Health Reform Initiative Advisory Council. Its purpose is to look into the possibility of establishing a state-based exchange and to submit recommendations to Virginia's lawmakers.

Although the Advisory Council voted in favor of running a state-based exchange, Gov. McDonnell dissented from passing additional legislation that would authorize establishing the exchange. He, together with other Republican lawmakers, were hoping that the Supreme Court would repeal the Affordable Care Act. When the Court upheld the reform law in its ruling in June 2012, the anti-ACA block chose instead to table legislations that will push through the establishment of an exchange. Finally, on December 14, 2012, Gov. McDonnell announced that it will not run a state-based exchange.

This does not mean that Virginia will no longer have a health insurance exchange; their exchange will just be run by the federal government. Why indeed is it important to run it? Briefly, here are five benefits the state can have from an ACA-compliant health insurance exchange.

First of all, the health insurance exchange will provide a venue for the residents of Virginia to purchase an insurance plan (or Medicare and extended Medicaid). Since it is a computer-based marketplace that will feature all approved insurance companies and health providers, it makes availing a plan convenient - literally making it available at click of a finger (or rather, a mouse).

Secondly, the information-driven marketplace will allow customers to check various companies and health providers. They will be able to compare product offerings, coverage and benefits, and the prices under the different companies. This gives the customers a huge advantage in that they can choose which best fits them plus which they find most affordable. Not only this: because the marketplace is open to scrutiny, there is a greater chance that insurance companies will lower their prices to attract more customers. The healthy competition brought about by the exchange will therefore promote better products and higher quality services.

Thirdly, the Patient Protection Affordable Care Act states that only compliant insurance and health care providers will be included in the exchange. Being compliant entails certain reforms in insurance policies which include the following: offering insurance to those with pre-existing conditions who have previously been denied health care coverage; inclusion of children below 26 years of age in the family health insurance, wherein previously only those who are 18 years old and below are allowed in the plan; inclusion of preventive care in the coverage, which includes 22 preventive care services for women, 16 services for adults, and 27 services for children; removal of lifetime limits in policies; and adherence to an 80/20 rule that mandates insurance companies to allocate 80% of premiums for health care and the remaining 20% for salaries and operational costs - an accounting system that was never before required of insurance providers (and which ultimately makes insurance providers more accountable to their customers).

Given these advantages, it is important that Virginia support the health insurance exchange initiative. Just the three reasons above will bring boundless benefits to thousands of residents who deserve better care especially these trying times.

Google Plus One