Obama officials ditch ‘exchanges’ in rebranding of healthcare reform law

The Obama administration is re-branding the central component of its signature healthcare law.

The Health and Human Services Department suddenly stopped referring to insurance “exchanges” this week, even as it heralded ongoing efforts to prod states into setting up their own. Instead, press materials and a website for the public referred to insurance “marketplaces” in each state.

The change comes amid a determined push by conservative activists to block state-based exchanges in hopes of crippling the federal implementation effort.

Dean Clancy, the director of healthcare policy at FreedomWorks, said HHS’s decision to ditch the “exchanges” label shows that opponents of the healthcare law are succeeding.

“I think the patient-centered care movement can chalk up a minor victory here,” he said. “If they’re trying to re-label, it means they’re flailing.”

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FreedomWorks runs a website, blockexchanges.com, that’s trying to build grassroots opposition to the insurance markets. The effort has taken on heightened importance in the wake of President Obama’s reelection, which killed off any chance of repealing “ObamaCare” in Congress.

Nearly every Republican governor has rejected a state-based exchange, although some could end up working in partnership with the federal government. Even Republicans who had previously seemed open to the idea have since said they wouldn’t pursue their own exchanges, instead leaving the task up to HHS.

Changing the name to “marketplaces” won’t make any difference, Clancy said.

“They could call them motherhood or apple pie, but it wouldn’t change our feelings about them,” Clancy said. “We're encouraged that they're showing signs of desperation. I think that it’s too late in the game to try to start calling this something different. And [we’re] not going to spend a lot of effort fighting over a word.”

Democrats and supporters of the healthcare law say the name change wasn’t meant to assuage political opposition to the healthcare law. “Exchange” simply isn’t a very good description, they said.

“It’s not that exchanges are unpopular, but there also isn’t broad awareness about what they are and what they will do for the people who will benefit from them across the country, so it makes sense to use a more descriptive name,” a Democratic source said. “The fact is, both Democratic and Republican Governors across the country are building this infrastructure and open enrollment is only eight months away so it’s time to start raising awareness. Once people get used to having these marketplaces to increase competition and deliver tax credits, there’s no question they will be popular.”

Exchanges are designed to function as one-stop marketplaces for people who don’t receive health coverage through an employer. Customers will be able to compare and buy plans online, usually with help from a federal subsidy.

Exchanges also can fill a regulatory function. State exchanges have the power, for example, to limit the number of plans they’ll accept, or to impose additional benefit requirements on top of those spelled out in the healthcare law.

States that don’t set up their own exchanges will defer those choices to the federal government, but critics say HHS has too much power over even state-run exchanges.

Supporters of the healthcare law noted that states have come up with their own names for their exchanges. Massachusetts’, which predates the federal healthcare law, is called the “Connector.” California considered an array of options, including “Avocado” and “Condor,” before settling on “Cover California.”

“The target here is not to make states change,” said Alan Weil, executive director of the National Academy of State Health Policy. “I do think they have come to the realization that the term ‘exchange’ does not actually communicate much to the average citizen.”