Feds ‘Conditionally’ Approve California’s Health Insurance Exchange

California's insurance marketplace, Covered California, will open in October, 2013. People will be able to buy insurance, which will take effect January 1, 2014.

California's insurance marketplace, Covered California, will open in October, 2013. People will be able to buy insurance, which will take effect January 1, 2014.

As expected, the federal government on Thursday approved California’s plan to run its own health insurance exchange — a marketplace where individuals and small businesses will be able to shop for health insurance. The exchange is one of many requirements of the Affordable Care Act.

The exchange, now known as Covered California, was granted “conditional approval” from the U.S. Department of Health and Human Services. Seven other states also received conditional approval, bringing the national total to 19 states as well as Washington, D.C. which have been fully or partially approved. States have until February 15 to apply to run an exchange in partnership with the federal government.

The Associated Press reports that Covered California expects to expand coverage to two million people. About seven million Californians — or 18 percent of the state’s population — lack health insurance.

More from AP:

Health and Human Services Secretary Kathleen Sebelius said Thursday’s action will accelerate development of the health insurance marketplaces, where she said consumers will be able to buy affordable, high quality insurance. Conditional approval “will provide the information states need to guide their continued work.”

California was the first state to authorize a health insurance exchange after passage of the federal Affordable Care Act in 2010. …

The federal health care law seeks to increase health coverage by 2014 by creating new online insurance markets for individuals and small businesses to shop for subsidized private coverage, and by expanding Medicaid for low-income people. Medicaid is known as Medi-Cal in California and currently serves 7.7 million adults and children. …

The approval was granted on the condition that California demonstrates it can meet exchange requirements and comply with deadlines and regulations.

In a statement, California’s Secretary of Health and Human Services and Covered California Board Chair Diana Dooley said, “This is another significant step in California’s long but determined march toward better health at an affordable price.”

“California has been at the forefront of establishing a health benefits marketplace that will serve millions of Californians,” Peter V. Lee, Executive Director of Covered California also said in a statement. “The approval to operate a state-based exchange indicates that we’re making good progress towards providing California residents with quality health benefits at a fair price.”

Californians will be able to shop for insurance via a web portal starting on October 1. Insurance purchased will go into effect on January 1, 2014. The website will provide tools for people to determine if they qualify for a subsidy to purchase insurance or to see if they qualify for other government health insurance programs, such as Medi-Cal or Medicare.

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