Will the Health Insurance Exchanges Benefit Consumers? Take Our Poll

The new Affordable Care Act has raised many different issues on policies, but especially on issues of insurance exchanges. Here are some pros and cons on the benefits of exchanges as they relate to consumers.



The Patient Protection and Affordable Care Act, Section 1311, “Part II—Consumer Choices and Insurance Competition through Health Insurance Exchanges,” page 55, signed into law on Mar. 23, 2010, available at www.thomas.gov, states:

“(3) USE OF FUNDS.—A State shall use amounts awarded under this subsection for activities (including planning activities) related to establishing an American Health Benefit Exchange, as described in subsection (b).”  – Patient Protection and Affordable Care Act




Here are the pros and cons

Data from procon.org


The US Department of Health and Human Services (HHS), stated on its Aug. 23, 2012 posting “Creating a New Competitive Marketplace: Affordable Insurance Exchanges,” last updated on www.healthcare.gov:

“Affordable Insurance Exchanges will provide individuals and small businesses with a ‘one-stop shop’ to find and compare affordable, quality private health insurance options.

Exchanges will bring new transparency to the market so that Americans will be able to compare plans based on price and quality. By increasing competition between insurance companies and allowing individuals and small businesses to band together to purchase insurance, Exchanges will help lower costs.”


Timothy Stoltzfus Jost, JD, Robert L. Willett Family Professor of Law at the Washington and Lee University School of Law, wrote in his July 2010 article “Health Insurance Exchanges and the Affordable Care Act: Key Policy Issues,” available at www.commonwealthfund.org:

“Health insurance exchanges are the centerpiece of the private health insurance reforms of the Patient Protection and Affordable Care Act of 2010 (ACA). If they function as planned, these exchanges will expand health insurance coverage, improve the quality of such coverage and perhaps of health care itself, and reduce costs…

One valuable role that exchanges can play is to administer subsidies that assist lower- and middle-income people in purchasing insurance… Exchanges are ideally situated to administer these subsidies, as eligibility can be determined during the enrollment process, and the subsidies can be sent directly to the insurance plan chosen by each person.”



Avik Roy, Senior Fellow at the Manhattan Institute for Policy Research, stated in his Nov. 19, 2012 article titled “What States Should Build Instead of Obamacare’s Health Insurance Exchanges,” posted at forbes.com:

“Obamacare takes [the exchange] concept and distorts it in a critical way, by taking over the insurance market and micromanaging the design of insurance plans that can be sold on the law’s exchanges.

…[T]he thrust of Obamacare’s exchanges is to shoehorn consumers into a narrow set of government-approved products, so as to protect them from making choices that the government deems unwise. The side effect of this approach is to prevent insurers from coming up with innovative products that deliver cost-efficient care…

Imagine if the government required that you could only buy a home that was between 2,000 and 2,500 square feet, with two bedrooms, five electrical outlets, and a solar panel, and you get a sense of what Obamacare’s exchanges do.”


Edmund Haislmaier, Senior Research Fellow of Health Policy Studies at the Heritage Foundation, stated in his Mar. 21, 2011 article “A State Lawmaker’s Guide to Health Insurance Exchanges” available at www.heritage.org:


“Health insurance exchanges are a good idea—if they are used to implement patient-centered and market-based health reforms that enhance choices and value for customers. The exchanges prescribed by Obamacare will have the opposite effect…

Rather than serving as a mechanism for expanding health insurance choice, variety, and competition, and for spurring plans and providers to innovate and offer customers better value, Obamacare exchanges will impose new regulations, administer new subsidies, standardize coverage, and restrict consumer choice and insurer competition more than it is already. Thus, in the PPACA Congress has perverted the exchange concept into a bureaucratic tool for federal subsidization, standardization, and micromanagement of health insurance coverage by the Department of Health and Human Services.”


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