HHS Allocates $51 Million For Health Insurance ExchangesHHS Allocates $51 Million For Health Insurance Exchanges

The Department of Health and Human Services (HHS) announced Thursday the availability of up to $1 million in grants per state to help states begin work to establish health insurance exchanges. The department also published a request for comment calling for public input as HHS develops standards for the exchanges.

Starting in 2014, improved choices will be offered through health insurance exchanges -- new, competitive, state-run and consumer-centered health insurance marketplaces. The exchanges will require the development of a robust health information technology infrastructure that will store and present insurance data and offer eligible customers and businesses a secure website where they can compare health insurance plans and purchase health insurance easier.

"With most states struggling to keep their budgets in balance, these grants will give them the resources to conduct the research and planning needed to build the health insurance marketplace of the future," HHS Secretary Kathleen Sebelius, said in a statement. "We are working hand-in-hand with states as we carefully implement the exchanges to make sure they best meet people's health insurance needs."

The Patient Protection and Affordable Care Act authorized grants to the states to help them design and establish exchanges in time for millions of Americans to choose their coverage for 2014. This first round of exchange grants will give states resources to conduct the research and planning needed to build a better health insurance marketplace and determine how their Exchanges will be operated and governed.

HHS said in a statement that while each state has the option to establish and operate its own exchange or partner with another state or states to operate a regional exchange, if a state fails to create an exchange for its residents, HHS will help establish one on their behalf. Grant applications are available at http://www.healthcare.gov/center/grants and are due by September 1, 2010.

HHS also said Thursday that in keeping with the Obama administration's commitment to transparency and open government, HHS has issued a request for comment asking states, consumer advocates, employers, insurers, and other interested stakeholders to provide input as HHS develops the rules and standards exchanges should be required to meet. Comments are due by October 4, 2010.