An "Exchange" of Ideas

June 25, 2010-    It certainly took me by surprise. Running a few minutes late to a meeting of the Florida Health Choices Corporation Board, I arrived just in time to catch the first of several references to FHC as “Florida's health insurance exchange”. 

Um…the health insurance marketplaces created by the Affordable Care Act? One of those exchanges? 

Yes. One of those.

The source of my confusion was that, although both FHC and the new exchanges are supposed to provide “competitive marketplaces”, that's as far as the similarity goes.

In fact, if both get up and running, likely the only trait they'll share is that they will sell something related to health care using a website.

FHC, created by the Legislature in 2008, was championed by then-House Speaker and now avowed opponent of health reform, Marco Rubio.  The law calls for a so-called “farmer's market” that lets vendors peddle whatever bits and pieces of health insurance coverage they want to offer.

Free from the usual restrictions that apply to health insurance, FHC vendors will be able to slice and dice to create an array of products that would never be considered real coverage, offering them for as little as employers decide to spend.   Consumer protections are an afterthought, as FHC will even be able to sell products that the Insurance Commissioner rejects.

The health insurance exchanges, by contrast, will take the opposite of the dangerous “anything goes” approach. Only high-quality coverage options will be allowed, and that coverage will be matched with subsidies to make sure it's affordable for low- and middle-income people. In addition, the insurers offering this coverage must meet real transparency and accountability standards. No one buying coverage through the exchange will be surprised later by a rotten tomato hidden in a farmer's market bag.

FHC's aim is to give businesses the opportunity to sell what they want, with consumers perhaps benefitting in the process, if they guess right.  The aim of the exchanges, though, will be to ensure that people can get and keep the real coverage they need.

That's not to say that choice will be lacking in the exchanges. By law, plenty of options will be available. What won't be available, however, is the “choice” to get stuck with a bad deal and still not be adequately covered.  Most or all of the products FHC was created to sell will be barred at the door.

So why then would FHC refer to itself as Florida's exchange? Well, there won't be a real exchange up and running until 2014. Even though FHC, at least in its current form, can never be an exchange, it might boost business if they market it that way in the meantime.