Insurance Industry May Find Spot on Nevada Health Exchange Board

The Silver State Exchange, the agency tasked with governing the state’s subsidized health insurance marketplace, is pushing for overhauls that could give the insurance industry a seat on its board and cement the federal government’s increasing control over the agency.

The push is a sign of the agency mending a wound it gashed with private insurance companies, overcoming the complexities of the Affordable Care Act and continuing its rebound after a year of bad headlines.

Republican Gov. Brian Sandoval’s administration is backing the effort, which has provoked skepticism among Democrats in the Assembly’s commerce and labor committee.

The bill would revoke a requirement prohibiting members of the insurance industry to sit on the board while adding two governor-appointed board members. It would allow two members on the board to have experience in the insurance industry.

It is headed to the Assembly floor for a vote in the coming days and will likely pass over to the Senate.

The exchange board currently consists of seven voting members and votes on all policies proposed by the agency’s staff. When Sandoval and the Legislature created the exchange in 2011, there were fears that giving the insurance industry an opening on the board could create potential for conflicts of interest.

Democratic Assemblywoman Maggie Carlton was part of the debates four years ago and is questioning letting someone with ties to the insurance industry sit on a board that approves the rates, policies and companies that sell health plans on the exchange.

“We wanted to err on the side of caution and make sure we didn’t give the impression that anyone in the insurance industry had too much influence on this board. I have concerns about changing the size of the board, giving the governor more appointees on the board and changing that perception of the board as far as its participants.”

Exchange staff certify plans and prices before the board votes on them. The potential for the board to assist or injure an insurer “simply won’t happen,” said Bruce Gilbert, executive director of the exchange.

The legislation embodies years’ worth of changes in the Nevada insurance marketplace during the era of the Affordable Care Act.

Many in the insurance industry felt slighted when the exchange launched its first open enrollment in October 2013. The exchange’s software, built by Xerox, was laced with thousands of glitches that prevented insurance brokers, people who sell plans, from getting paid and kept consumers from receiving health insurance they were paying for. There was also the introduction of a hybrid insurance broker, known as navigators, that were perceived by some in Nevada as a shoddy attempt at squeezing brokers out of the health insurance marketplace.

The board, which consists of doctors, lawyers and members of the business community, often spent meetings last year fielding complaints from members of the insurance community.

Making room for insurance experts is overdue and doesn’t pose any foreseeable conflicts, Gilbert said.

“Having representation from the health insurance community is a very good thing,” he said. “It is something that would have put us in good stead a year or two ago.”

A minor, uncontested provision in the bill calls for the state to remove the requirement in law that the exchange be “state based.”

While it highlights no controversy in the Legislature, the removal of that language details the roller-coaster history of the exchange.

The cornerstone change was the board’s decision to unhook from the Xerox software and plug into the federal government’s system in May.

The move pivoted the exchange away from its original mission: operating an exchange without the help of the federal government.

Sandoval was the first Republican governor to call for creating a state-run exchange in 2011, defying much of the partisan bickering that shrouded debates about the Affordable Care Act.

But now Nevada is one of three states that retroactively plugged into the federal system after their enrollment software underperformed. But unlike the 18 states with marketplaces fully operated by the federal government, Nevada still has some independence from Washington, Gilbert said.

Nevada has control of the marketing, outreach and plan certification, he said.

“There is no single state that would have been able to afford the technology platform that’s available to us,” Gilbert said. “Not in terms of building it or maintaining it. It’s kind of the best of both worlds. And it’s a model that’s getting a lot of interest nationally.”

The news of the bill follows a victory for the exchange. It enrolled 72,000 Nevadans for subsidized health insurance plans offered by private companies since Nov. 15, doubling its enrollment in the prior sign-up period. The exchange has also helped to channel more than 250,000 Nevadans to Medicaid plans during the past two years.

States like Wyoming, Arizona, Florida and Utah are still keeping their citizens from gaining access to federally subsidized health care.

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