Running health insurance exchanges, states have found, is a complicated and expensive proposition. For a handful of states, that meant opting to use the federal Obamacare exchange, which is now threatened by the Supreme Court in the
King v. Burwell case, the challenge that says Congress intended to only allow subsidies to go to people buying insurance on exchanges established by states. The prospect of losing those subsidies, as well as the fact that federal support to states to maintain the exchanges ends next year, is leading states to
explore merging exchanges, a provision that is allowed under the law.
The idea is still only in the infancy stage. It’s unclear whether a California-Oregon or New York-Connecticut health exchange is on the horizon.
But a shared marketplace—an option buried in a little-known clause of the Affordable Care Act—has become an increasingly attractive option for states desperate to slash costs. If state exchanges are not financially self-sufficient by 2016, they will be forced to join the federal system, HealthCare.gov.
"What is happening is states are figuring out the money is running out," said Jim Wadleigh, the director of Connecticut’s exchange, hailed as one of the most successful in the country. "At the end of 2016, everyone has to be self sustaining." […]
"In the last seven business days, I've probably had seven to 10 states contact me about contingency plans," Wadleigh said, though he declined to disclose the names of states he's been talking to. "You can imagine the political backlash that would be if the names got out."
And, of course,
King. Some states actually do care about the tens of thousands of their residents who could lose subsidies and believe merging with states that have their own is a viable solution, since they sure as hell can't count on a Republican Congress to come up with one. How far states can go in combining systems is the big question. States are still responsible for regulating health insurers operating within them, and many insurers don't operate across state lines, complicating any regulatory aspect that they have to deal with.
But they could share technology and things like call centers and navigators. States would still have to work out things like cost-sharing and divvying up administrative responsibilities. But it could be the best solution available barring congressional action.
