ACA Title 1, Sec. 1311. Affordable choices of health benefit plans. “Good” – Established the ground rules for the development and operation of “exchanges.”This section of the Law covers the provision of grants to states for the development of “American Health Benefit Exchanges” including assistance to states to establish exchanges using grant funds, including the establishment of Small Business Health Options Program exchanges (SHOP exchanges), functional activities, basic requirements, rating processes and rules for operation. This section also provides the basic requirement for “qualified individuals”, “qualified health plans”, “qualified employers”, and funding conditions. This section enables the refinements that the promulgation of federal regulations achieves. In general the establishment of basic ground rules for the operation of exchanges will ultimately improve price competition among health plans helping to stabilize future medical trend. However in the meantime, if economic “free riders” are still allowed to purchase health insurance only when they need it, health plans on the exchanges will likely experience periodic “death spirals” from adverse selection. The exchanges themselves will likely have to step in to prevent financial insolvency among the more popular health plans.

Please let others know about this blog and have them “follow” @Wellness Czar on Twitter for the section topics. This blog is also available periodically in a color-coded PDF format upon request.