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Rhode Island Applies for Second Round of Federal Funding to Establish Health Benefit Exchange

Providence, RI – The State of Rhode Island recently applied for a grant totaling $74.5 million to fund the development, design, and technology procurement of its Health Benefit Exchange. The exchange, established by Executive Order 11-09, will function as an online marketplace for health insurance for eligible individuals, families, and small businesses, linking all Rhode Islanders with affordable health coverage, and providing access to federal subsidies for those who qualify. It will be operational by January 2014.

The Health Benefit Exchange is one of the requirements of the federal health care reform law, the Affordable Care Act (ACA). The ACA gives Rhode Island the opportunity to design its own exchange, using federal funds to create a system that is individually tailored to meet Rhode Islanders’ needs. Under the ACA, the state’s failure to establish an exchange of its own would result in the federal government imposing a generic exchange on Rhode Island.

Significantly, Executive Order 11-09 has enabled Rhode Island to meet federal deadlines to be eligible for almost $75 million in flexible funding and continue the momentum that has been building over the last year toward implementing this important reform. The Executive Order authorized the creation of the exchange, within the executive branch, under the guidance of an appointed advisory board led by former U.S. Attorney Meg Curran. Existing state agencies will be coordinated to implement this new way for Rhode Islanders to access health insurance and obtain federal subsidies to buy insurance if they can't otherwise afford it. The federal funds at stake represent one of the largest grants in Rhode Island history and will enable the state to build new systems to make health insurance more understandable, easier to purchase and more affordable for many, while at the same time modernizing antiquated systems in related public insurance programs such as Medicaid.

“Moving forward with the Health Benefit Exchange is an important step in making affordable healthcare a reality in our state,” Governor Chafee said. “I am confident Rhode Island will be awarded this second round of funding and will implement an exchange that allows individuals and small businesses to choose from a range of comprehensive, understandable and affordable insurance options.”

“Federal health reform has already started to deliver real benefits for small businesses, families, seniors and young adults across Rhode Island,” Governor Chafee continued. “The exchange will bring us even closer to our vision of a healthy state with access to high quality, community-based medical care for all Rhode Islanders.”

The state is expected to learn whether it has been awarded the second round of funding by December 2011.

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