A report released last week by the Congressional Research Service (CRS) examines the Health Insurance Exchanges under the Affordable Care Act (ACA). The CRS report outlines the required minimum functions of exchanges, and explains how exchanges are expected to be established and administered under ACA. The coverage offered through exchanges is discussed, and the report concludes with a discussion of how exchanges will interact with selected other ACA provisions.

A report recently published by Price Waterhouse Cooper (PWC) examines states' progress on exchange establishment. The report found that the country, on the whole, is lagging. Only 13 states have decided to create exchanges, while eight have indicated that they will let the federal government take control of exchange establishment. The majority, the report says, are still undecided, and have until November 15 to make a final decision. The PWC report also details typical exchange participants. On average, they are 33 years old, unlikely to have a college degree, and under 200 percent of the federal poverty limit.

Health insurance exchanges form the backbone of the private insurance reforms called for in the Affordable Care Act (ACA), as they will create a marketplace in each state for small employers and individuals without job-based health insurance to buy comprehensive health coverage, with premium subsidies available for those with low or moderate incomes. As of May 2012, 13 states, together with the District of Columbia, had taken legal action to establish exchanges, through legislation or executive order. State implementing laws are essential to the translation of broad federal policies into specific state and market practices. Overall, the laws in the 14 jurisdictions vary, but they tend to show a common approach of according exchanges much flexibility in how they will operate and what standards they will apply to the insurance products sold. In all states, these "threshold policies" will be followed by policy decisions, expressed through regulations, guidelines, and health plan contracting and performance standards. A new Commonwealth Fund issue brief analyzes the choices being made by the jurisdictions to begin establishing exchanges.