HHS announces new grants for insurance exchanges

The Department of Health and Human Services announced new grants Thursday afternon to help states implement health insurance exchanges, a key provision of the reform law.

The exchanges, which open in 2014, allow individuals and small businesses to pool purchasing power in new state-run insurance markets.

Although more than half the states are challenging the reform law in federal courts, 48 states in September accepted a total of $49 million for researching and planning exchanges. Alaska and Minnesota were the only states to reject the grants.

The new grants will allow states to take the next step toward implementation, HHS Secretary Kathleen Sebelius said on a conference call with reporters. States can either apply for multi-year or short-term funding.

“The new funding we’re announcing today allows states to maintain momentum as we head toward 2014,” Sebelius said. “It recognizes that states are at very different stages in exchange planning and have different needs.”

Sebelius said HHS did not have a precise funding amount for the grants, which she said were specifically authorized and appropriated in the reform law.

“We anticipate states giving us a plan and giving some determination about overall funding,” Sebelius said. “As you might imagine, the needs of the state of California … may be very different from a very small state.”