The State-based Marketplaces: A Focus on Innovation, Flexibility, and Coverage
One of the central elements of the Affordable Care Act (ACA) is to establish “one-stop shopping” through health insurance marketplaces allowing consumers to find and access affordable, high-quality health coverage either through private health insurance, and the subsidies available for those who qualify, or through Medicaid. The ACA and related regulations define a spectrum of marketplace models that can be operationalized: the State-based Marketplace (SBM), where states assume all responsibility for operation and maintenance of a marketplace; the State Partnership Marketplace (SPM), where states assume responsibility for plan management and/or consumer assistance and the Federally-Facilitated Marketplace (FFM) performs remaining functions; and the FFM, in which all marketplace functions are performed by the federal government.
In the wake of the U.S. Supreme Court’s recent decision in King v. Burwell, affirming the availability of federal subsidies to states opting to use the FFM model, there is growing interest in state and federal marketplace options and performance. While states implementing both the FFM and SBM model had to overcome hurdles in building and managing multifaceted IT platforms, both are making significant progress in meeting the ACA’s coverage and access goals. However, the advancements and opportunities of SBMs are not as well known as the challenges state and federal marketplaces have faced. This paper seeks to explore and highlight early developments in states that have implemented the SBM model.