Question

Briefly describe two (2) critical functions that Health Insurance Exchanges/Marketplaces perform.

Answer 1

Health Insurance Exchanges is now renamed as Health Insurance Marketplaces. It was designed to assure health insurance coverage for all sections including the individuals and small group employers who have had barriers in the marketplace to obtain insurance benefits. The individuals and the small business groups can compare and purchase health plans to receive premium subsidies for those who are eligible. The Health Insurance Exchanges enables an individual is selecting a plans for inclusion by providing plan options in a standardized way and provide them with electronic resources.

Another function is that the states have an option to either develop their own exchange or allow the federal government to establish and run the exchanges for the states. In this process, the Health Insurance Exchange helps in avoiding adverse selection of the insurance plans because it is either regulated by the State or the Federal government to act on behalf of the state. The Health Insurance Exchanges operates a consumer assistance program to help the insurers in their decisions.