Kill or Cure

Launched in 2009, the Utah Health Exchange is still in its infancy. Even so, the program seems to be struggling to find its legs. More than 6,000 Utahns are enrolled in health insurance plans through the Exchange—but that is just a drop in the bucket compared with the nearly 1.7 million Utahns who receive coverage through their employers.

The Utah Health Exchange is a web-based portal where small businesses and their employees can shop for health insurance plans. Currently, large employers and individuals cannot utilize the Exchange.

While the Exchange is new and still working through some obstacles, the healthcare industry is supporting the Exchange to try and make it succeed, says Dave Gessel, vice president of government relations and legal affairs for the Utah Hospital Association. “If we can make it work, it will benefit the citizens of the state of Utah,” he says. “But it’s not going to be an overnight success. It needs to grow. It will happen over time.”

Seeds of the Exchange
In 2005, Gov. Jon Huntsman’s administration made health system reform a high priority. Since then, legislative leaders and state executive staff have worked together on this common goal.

In 2008, legislation was passed that directed the state to create a website that would help educate consumers and aid them in sifting through the myriad health insurance options. Additional legislation furthered the plan along in 2010, and more amendments and further structure was formed in 2011.

The Exchange launched its pilot program in fall 2009 and enrolled 11 groups that joined the Exchange for one year. This gave the Exchange creators a chance to evaluate how the enrollment was going, as well as the opportunity to update the technology and review processes. The Exchange was opened up to all interested groups in January 2010, allowing brokers and small employee groups to join.

“Every month we continue to grow in enrollment,” says Patty Conner, director of the Office of Consumer Health Services and director of the Utah Health Exchange. She adds that in January 2012 alone, 46 groups were eligible for renewal, and 45 of them chose to stay on the Exchange.

For many small employers, the Exchange is still new and relatively unknown. “While there is support for the Exchange, there is also resistance—which is natural in any industry when you try and change the business model,” Gessel says.

Because it is geared toward a small market, a lot of insured people don’t have the opportunity to use the Exchange right now, he adds. “Further, the uncertainty of the federal health reform and how that will impact the Exchange has also played a major role in limiting the participation in the Exchange.”

Market-driven Solution
The Utah Health Exchange is intended to be a market-based approach to health system reform. It works to “connect the insurance carriers and small business employers together so that small businesses can purchase insurance through a variety of carriers and different benefit plans for different prices,” says Conner.

Three insurance providers offer plans on the Exchange: Regence BlueCross BlueShield of Utah, UnitedHealthcare and SelectHealth. There are also two health savings account administrators. New carriers will be able to join as early as January 2013 under the current statute.

The three insurance carriers cover the entire state, and they each have different plans on the Exchange. The carriers are required to put their four most popular plans from the traditional market on the Exchange. The other plans they put on the Exchange can be what they think best meet the demands of the marketplace. In total, the Exchange features 150 different plan designs.

“So you will see a variety of different plans,” Conner says. “Sometimes it’s maternity or chiropractic. It allows the carrier to play around with deductibles and co-insurance so they can offer different price points for the employee. From the employee’s perspective, they have all that variety to choose from.”

Scott Thompson, media relations director with Regence BlueCross BlueShield of Utah, says, “We want to help consumers get better access to healthcare…It’s a way we can transform our healthcare system and offer Utahns more opportunities to find affordable healthcare—and for employers to offer healthcare to their employees at affordable prices as well.”

The Exchange is ever changing. In the future, some underwriting processes will be revamped so it will be smoother and will result in more comparable rates to the traditional market. “It will adapt and change,” Thompson says. “We’re looking forward to it evolving and growing and becoming a viable part of our business.”