U.S. Health and Human Services Secretary Kathleen Sebelius announced a new funding opportunity for state grants to help states implement health insurance exchanges (HIEs).

Without confirming a "precise amount" of money available, Sebelius told reporters on a conference call that her department will be vigilant about checking states’ budgets submitted with applications and will focus on keeping states’ expectations realistic about how much funding they will receive.

To date, 48 states and the District of Columbia have received planning grants of approximately $1 million each for HIEs, which are viewed as a key element of the Patient Protection and Affordable Care Act.

HIEs are designed to bring new transparency to the market so that consumers will be able to compare plans based on price and quality, giving American consumers insurance choices. They will also increase competition among insurers.

Those moving ahead with HIE plans can apply for multi-year funding. The option to states that are making progress in a step-by-step approach can apply for funding for each project year.

States can use the exchange establishment grants for several activities, including conducting background research, consulting with stakeholders, making legislative and regulatory changes, governing the exchange, establishing IT systems, conducting financial management and performing oversight and ensuring program integrity, according to reports.

Thanks to the $49 million in exchange planning grants awarded by HHS in July of 2010, some states are already on the path to making HIEs a reality, such as California, Maryland and Colorado, each of which have accomplished various steps to implementing the technology. The exchange establishment funding announcement can be found at www.Grants.gov by searching for CFDA number 93.525.

Speer writes for Insurance Networking News, a SourceMedia publication.Follow EBN on: Twitter | Facebook | LinkedIn | Podcasts

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