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National Health Plans

The federal government will soon take on a new role as the sponsor of at least two national health insurance plans to be operated under contract with the federal government and offered to consumers in every state. The new plans would be offered to individuals and small employers through the Exchanges in every state. The national health plans will automatically be eligible to compete against other private insurers in the Exchanges, regardless of whether they have been certified as meeting the standards of those exchanges.

Compete With Private Insurers

The national plans will compete directly with private insurers. Premiums and benefits for the multistate insurance plans will be negotiated by the United States Office of Personnel Management (OPM) , the agency that arranges health benefits for federal employees. OPM has more than 200 health plans including about 20 offered nationwide.

Under the ACA, at least one of the nationwide plans must be offered by a nonprofit entity. Insurance experts see an obvious candidate for that role: the Government Employees Health Association (GEHA), a nonprofit group that covers more than 900,000 federal employees, retirees and dependents, making it the second-largest plan for federal workers, after the Blue Cross and Blue Shield program. GEHA is licensed in every state.

Questions and Concerns From All Sides

The National Association of Insurance Commissioners (NAIC), which represents state regulators, expressed alarm at the prospect of a double standard. "It is absolutely essential that multistate plans compete on a level playing field with other qualified health plans, which are subject to state insurance law," the NAIC said in a letter to the Office of Personnel Management.

Consumer groups expressed similar concerns. The national insurance plans and other carriers must be subject to identical standards, they say, or consumers cannot make valid comparisons. "Multistate plans have real potential benefits for consumers," said Ronald F. Pollack, the executive director of Families USA. "But there is also potential trouble if the multistate plans are exempted from some consumer protection standards."

Insurers are pleading with the Office of Personnel Management to provide more detailed guidance. "We are concerned that O.P.M. has not yet released rules specifying the requirements for the multistate plan," said Jay A. Warmuth, a lawyer at UnitedHealth Group, one of the nation's largest insurers.

Rules for the new program have been under review by the White House for three months, and officials said they would be issued soon.

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