Vermont wins federal approval for health care exchange

The federal government has given a preliminary thumbs-up to an online health insurance marketplace set to go into effect in 2014.

In a press release fired off this afternoon, the Shumlin administration said the U.S. Department of Health and Human Services gave conditional approval to the “Health Benefit Exchange” now under construction at the Department of Vermont Health Access.

The federal Affordable Care Act mandates that every state have a health benefit exchange in place by January of next year, but Vermont has pursued the program more vigorously than most.

The state has drawn down well more than $100 million in federal grants to create the exchange, and legislation passed last year will require companies with 50 or fewer employees to purchase their insurance plans through it.

“Vermont continues to be a leader in health care reform, and this is another illustration of our progress toward meeting our reform goals,” Gov. Peter Shumlin said in a written statement. “We are building an Exchange that works for Vermonters now and in the future.”

Likened to a sort of Hotwire for insurance plans, the exchange is designed to provide consumers with an apples-to-apples price comparison of various plans. Proponents say it also ensures quality control by imposing minimum standards for plans sold in the exchange. Most individuals buying in the exchange will also be eligible for premium assistance or tax credits from the federal government. 

Vermont’s exchange – it’s being called “Vermont Health connect” – is different from the single-payer health care system Shumlin wants to have in place by 2017. But they are connected: Shumlin says he wants to use the exchange as a springboard into single-payer by squeezing as many Vermonters as possible into the exchange. According to administration officials, the exchange will then provide the structural framework through which the state will administer a publicly financed system of universal care.

From the release:

WILLISTON, VT – Today, the U.S. Department of Health and Human Services (HHS) announced that the State of Vermont has been granted conditional approval to operate its Health Benefit Exchange, Vermont Health Connect. This approval indicates that Vermont is compliant with federal regulations for operating a State-based Exchange and is prepared to begin open enrollment in October 2013, conditional on the State meeting specific milestones over the next nine months.

“Vermont continues to be a leader in health care reform, and this is another illustration of our progress toward meeting our reform goals,” said Governor Peter Shumlin. “We are building an Exchange that works for Vermonters now and in the future.”

Vermont Health Connect will be the marketplace for individuals, families, and small businesses to compare and purchase qualified private health insurance plans, determine eligibility for and enroll in public health insurance plans, and access tax credits and financial assistance to make insurance affordable. 

HHS Secretary Kathleen Sebelius congratulated Vermont for demonstrating how it will meet all requirements of the federal Affordable Care Act for establishing a State-based Exchange. Today’s approval indicates that the State has successfully met federal expectations and outlined plans for meeting additional federal requirements between now and October when the Exchange will open for shopping and enrollment. In addition, Vermont Health Connect will be uniquely tailored to Vermont. Secretary Sebelius’ letter of approval can be found at

“We are dedicated to building an Exchange Vermonters can trust. I thank HHS for their partnership in the development of our application and am pleased to learn that they share our confidence in launching Vermont Health Connect later this year,” said Mark Larson, Commissioner of the Department of Vermont Health Access. “We have made significant progress towards creating Vermont Health Connect as a place where Vermonters can access affordable, comprehensive coverage. Secretary Sebelius has clearly outlined the conditions of our full approval, and I’m certain that we will meet all conditions by the federal deadline.” 

Vermont is one of 19 states, plus the District of Columbia, to submit a standard “blueprint” application to construct and operate a State-based Exchange. As of now, conditional approval has been granted to all states that have submitted the “blueprint” application and full approval will be granted once all conditions are met.

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