California Takes Steps to Create Insurance Exhange

August 25, 2010

It was reported earlier today on the state of health care reform in California. It seems the Golden State is taking steps toward the establishment of a health insurance exchange, as is required in order to be in compliance with federal health care reform law.

The California Senate passed two bills which provide the functions and mechanisms of the exchange. One, which is waiting for the governor’s approval, sets up an online exchange where consumers will be able to compare participating insurance plans. The exchange will be operated by a state-appointed five-member board.

The second bill, which has been sent back to the state Assembly for its approval, details the exchange’s role in health care insurance, and creates a California Health Trust Fund which would finance the exchange.

Unsurprisingly, both bills passed along party lines, with Democrats approving, and Republicans opposing the initiatives.

According to the Patient Protection and Affordable Care Act, state-based exchanges for both small businesses and individuals to purchase health care insurance must be up and running by January 1, 2014, though either non-profit groups or government agencies may administer them.

While Governor Arnold Schwarzenegger announced in April that we would support health care reform, stating he would “…work with the federal government to get this done…” he has not stated whether or not he would be signing either of these bills.