H.F. _____ Section 1. NEW SECTION . 514M.1 Title. 1 This Act shall be known and may be cited as the “Iowa Health 2 Insurance Exchange Act” . 3 Sec. 2. NEW SECTION . 514M.2 Purpose and intent. 4 The purpose of this Act is to provide for the establishment 5 of health insurance exchanges in this state to facilitate 6 the sale and purchase of qualified health benefit plans in 7 the individual market in this state and to assist qualified 8 small employers in the state in facilitating the availability 9 of qualified health benefit plans offered in the small group 10 market. The intent of authorizing the establishment of health 11 insurance exchanges in the state is to reduce the number of 12 uninsured, provide a transparent marketplace and consumer 13 education, and assist individuals with access to programs, 14 premium assistance tax credits, and cost-sharing reductions. 15 Sec. 3. NEW SECTION . 514M.3 Definitions. 16 As used in this chapter, unless the context otherwise 17 requires: 18 1. “Commissioner” means the commissioner of insurance. 19 2. “Exchange” means a health insurance exchange established 20 or approved pursuant to section 514M.4. 21 3. “Federal Act” means the federal Patient Protection and 22 Affordable Care Act, Pub. L. No. 111-148, as amended by the 23 federal Health Care and Education Reconciliation Act of 2010, 24 Pub. L. No. 111-152, and any amendments thereto, or regulations 25 or guidance issued under, those Acts. 26 4. a. “Health benefit plan” means a policy, contract, 27 certificate, or agreement offered or issued by a health carrier 28 to provide, deliver, arrange for, pay for, or reimburse any of 29 the costs of health care services. 30 b. “Health benefit plan” does not include any of the 31 following: 32 (1) Coverage only for accident, or disability income 33 insurance, or any combination thereof. 34 (2) Coverage issued as a supplement to liability insurance. 35 -1- LSB 2010YC (11) 84 av/rj 1/ 20

H.F. _____ (3) Liability insurance, including general liability 1 insurance and automobile liability insurance. 2 (4) Workers’ compensation or similar insurance. 3 (5) Automobile medical payment insurance. 4 (6) Credit-only insurance. 5 (7) Coverage for on-site medical clinics. 6 (8) Other similar insurance coverage, specified in federal 7 regulations issued pursuant to Tit. XXVII of the federal Public 8 Health Service Act, as enacted by the federal Health Insurance 9 Portability and Accountability Act of 1996, Pub. L. No. 10 104-191, and amended by the federal Act, under which benefits 11 for health care services are secondary or incidental to other 12 insurance benefits. 13 c. “Health benefit plan” does not include any of the 14 following benefits if they are provided under a separate 15 policy, certificate, or contract of insurance or are otherwise 16 not an integral part of the plan: 17 (1) Limited scope dental or vision benefits. 18 (2) Benefits for long-term care, nursing home care, home 19 health care, community-based care, or any combination thereof. 20 (3) Other similar, limited benefits specified in federal 21 regulations issued pursuant to the federal Health Insurance 22 Portability and Accountability Act of 1996, Pub. L. No. 23 104-191. 24 d. “Health benefit plan” does not include any of the 25 following benefits if the benefits are provided under a 26 separate policy, certificate, or contract of insurance, there 27 is no coordination between the provision of the benefits 28 and any exclusion of benefits under any group health plan 29 maintained by the same plan sponsor, and the benefits are paid 30 with respect to an event without regard to whether benefits are 31 provided with respect to such an event under any group health 32 plan maintained by the same plan sponsor: 33 (1) Coverage only for a specified disease or illness. 34 (2) Hospital indemnity or other fixed indemnity insurance. 35 -2- LSB 2010YC (11) 84 av/rj 2/ 20

H.F. _____ e. “Health benefit plan” does not include any of the 1 following if offered as a separate policy, certificate, or 2 contract of insurance: 3 (1) Medicare supplemental health insurance as defined under 4 section 1882(g)(1) of the federal Social Security Act. 5 (2) Coverage supplemental to the coverage provided under 10 6 U.S.C. ch. 55, by the civilian health and medical program of 7 the uniformed services. 8 (3) Supplemental coverage similar to that provided under a 9 group health plan. 10 5. “Health carrier” means an entity subject to the insurance 11 laws and rules of this state, or subject to the jurisdiction 12 of the commissioner, that contracts or offers to contract to 13 provide, deliver, arrange for, pay for, or reimburse any of 14 the costs of health care services, including an insurance 15 company offering sickness and accident plans, a health 16 maintenance organization, a nonprofit hospital or health 17 service corporation, or any other entity providing a plan of 18 health insurance, health benefits, or health services. 19 6. “Insurance producer” means a person required to be 20 licensed under chapter 522B. 21 7. “Mandate-free health benefit plan” means a health 22 benefit plan that is exempt from some or all special health and 23 accident insurance coverages required pursuant to the federal 24 Act or chapter 514C. 25 8. “Qualified dental plan” means a limited scope dental plan 26 that has been certified in accordance with section 514M.8. 27 9. “Qualified employer” means a small employer that elects 28 to make its full-time employees eligible for one or more 29 qualified health benefit plans offered through the exchange, 30 and at the option of the employer, some or all of its part-time 31 employees, provided that the employer does either of the 32 following: 33 a. Has its principal place of business in this state and 34 elects to provide coverage through the exchange to all of its 35 -3- LSB 2010YC (11) 84 av/rj 3/ 20

H.F. _____ eligible employers wherever employed. 1 b. Elects to provide coverage through the exchange to all 2 of its eligible employees who are principally employed in this 3 state. 4 10. “Qualified health benefit plan” means a health benefit 5 plan that has in effect a certification as described in section 6 1311(c) of the federal Act and section 514M.8. 7 11. “Qualified individual” means an individual, including a 8 minor, who is all of the following: 9 a. Is seeking to enroll in a qualified health plan offered 10 to individuals through the exchange. 11 b. Is a resident of this state. 12 c. At the time of enrollment, is not incarcerated, other 13 than incarceration pending the disposition of charges. 14 d. Is, and is reasonably expected to be, for the entire 15 period for which enrollment is sought, a citizen or national of 16 the United States or an alien lawfully present in the United 17 States. 18 12. “Secretary” means the secretary of the United States 19 department of health and human services. 20 13. a. “Small employer” means an employer that employed an 21 average of one to fifty employees during the preceding calendar 22 year. 23 b. For the purposes of this subsection: 24 (1) All persons treated as a single employer under 25 subsection (b), (c), (m), or (o) of section 414 of the Internal 26 Revenue Code of 1986 shall be treated as a single employer. 27 (2) An employer and any predecessor employer shall be 28 treated as a single employer. 29 (3) All employees shall be counted, including part-time 30 employees and employees who are not eligible for coverage 31 through the employer. 32 (4) If an employer was not in existence throughout the 33 preceding calendar year, the determination of whether that 34 employer is a small employer shall be based on the average 35 -4- LSB 2010YC (11) 84 av/rj 4/ 20

H.F. _____ number of employees that is reasonably expected that employer 1 will employ on business days in the current calendar year. 2 (5) An employer that makes enrollment in qualified health 3 plans available to its employees through the small business 4 health options program exchange, and would cease to be a 5 small employer by reason of an increase in the number of its 6 employees, shall continue to be treated as a small employer 7 for purposes of this chapter as long as it continuously makes 8 enrollment through the small business health options program 9 exchange available to its employees. 10 Sec. 4. NEW SECTION . 514M.4 Establishment of Iowa health 11 insurance exchange —— additional exchanges authorized. 12 1. A health insurance exchange shall be established in 13 this state, and subject to the discretion of the commissioner, 14 may be operated by the insurance division of the department 15 of commerce under the supervision of the commissioner or as 16 a nonprofit corporation approved by the commissioner. The 17 commissioner shall approve the establishment of one or more 18 exchanges in the state that meet the requirements of this 19 chapter. An exchange or components of an exchange established 20 or approved pursuant to this subsection may be operated on a 21 statewide or regional basis, or on a multistate basis, subject 22 to the approval of the commissioner. An exchange established 23 or approved pursuant to this subsection shall be operated 24 pursuant to a plan of operation approved by the commissioner. 25 2. The commissioner shall establish a provider 26 reimbursement system for health benefit plans issued in this 27 state that all health carriers and health providers may join to 28 facilitate fair and reasonable payments for the cost of health 29 care services provided pursuant to a health benefit plan. 30 3. The commissioner shall create a value or outcome-based 31 reimbursement system for health benefit plans issued in this 32 state to which all health carriers may subscribe. 33 4. An exchange shall do all of the following: 34 a. Facilitate the purchase and sale of qualified health 35 -5- LSB 2010YC (11) 84 av/rj 5/ 20

H.F. _____ benefit plans to qualified individuals and qualified employers 1 as described in this chapter and in the federal Act. 2 b. Meet the requirements of this chapter and any rules 3 adopted pursuant to this chapter. 4 5. All persons who enroll in a qualified health benefit plan 5 offered through an exchange shall be enrolled by an insurance 6 producer. The health carrier that issues the qualified health 7 benefit plan selected shall pay the producer a commission of 8 at least five percent of the premium paid by the enrollee. 9 If a health carrier offers health benefit plans outside the 10 exchange, the health carrier shall pay an insurance producer 11 that enrolls a person in that health benefit plan a commission 12 of at least five percent of the premium paid by the enrollee. 13 6. An exchange may employ staff to carry out the functions 14 of the exchange, but no public employee shall sell, solicit, 15 negotiate, advise, or counsel consumers on health insurance or 16 otherwise offer services for which a license as an insurance 17 producer is required pursuant to chapter 522B. 18 7. An exchange may contract with an eligible entity to 19 fulfill any of its responsibilities as described in this 20 chapter. An eligible entity includes but is not limited to an 21 entity that has experience in individual and small group health 22 benefit plans, benefit administration, or other experience 23 relevant to the responsibilities to be assumed by the entity. 24 However, a health carrier or an affiliate of a health carrier 25 is not an eligible entity for the purposes of this subsection. 26 8. An exchange may enter into information-sharing 27 agreements with federal and state agencies and other state 28 exchanges to carry out its responsibilities under this chapter 29 provided such agreements include adequate protections with 30 respect to the confidentiality of the information to be shared 31 and comply with all state and federal laws and regulations. 32 Sec. 5. NEW SECTION . 514M.5 General requirements. 33 1. An exchange or exchanges established or approved 34 pursuant to section 514M.4 shall make qualified health 35 -6- LSB 2010YC (11) 84 av/rj 6/ 20

H.F. _____ benefit plans that are effective on or before January 1, 2014, 1 available to qualified individuals and qualified employers in 2 the state. 3 2. The exchange or exchanges that are established or 4 approved shall request a five-year waiver from the secretary 5 from the certification requirements for health benefit plans of 6 the federal Act to enable the exchange to offer mandate-free 7 health benefit plans in addition to offering qualified health 8 benefit plans through the exchange. 9 3. The exchange or exchanges shall allow a health carrier 10 to offer a plan that provides limited scope dental benefits 11 meeting the requirements of section 9832(c)(2)(A) of the 12 Internal Revenue Code of 1986 through the exchange, either 13 separately or in conjunction with a qualified health benefit 14 plan, if the plan provides pediatric dental benefits meeting 15 the requirements of section 1302(b)(1)(J) of the federal Act. 16 4. An exchange or a health carrier offering qualified 17 health benefit plans through an exchange shall not charge an 18 individual a fee or penalty for termination of coverage if 19 the individual enrolls in another type of minimum essential 20 coverage because the individual has become newly eligible for 21 that coverage or because the individual’s employer-sponsored 22 coverage has become affordable under the standards of the 23 federal Act, to be codified at section 36B(c)(2)(C) of the 24 Internal Revenue Code of 1986. 25 Sec. 6. NEW SECTION . 514M.6 Duties of an exchange. 26 An exchange established or approved pursuant to section 27 514M.4 shall do all of the following: 28 1. Implement procedures for the certification, 29 recertification, and decertification of health benefit plans 30 as qualified health benefit plans, consistent with guidelines 31 developed by the secretary under section 1311(c) of the federal 32 Act and applicable state law. 33 2. Provide for the operation of a toll-free telephone 34 hotline to respond to requests for assistance. 35 -7- LSB 2010YC (11) 84 av/rj 7/ 20

H.F. _____ 3. Provide for enrollment periods, as determined by the 1 secretary under section 1311(c)(6) of the federal Act and 2 applicable state law. 3 4. Maintain an internet site through which enrollees and 4 prospective enrollees of qualified health benefit plans may 5 obtain standardized comparative information on such plans. 6 5. Assign a rating to each qualified health benefit plan 7 offered through the exchange in accordance with criteria 8 developed by the secretary under section 1311(c)(3) of the 9 federal Act, and determine the level of coverage of each 10 qualified health benefit plan in accordance with regulations 11 issued by the secretary under section 1302(d)(2)(A) of the 12 federal Act and applicable state law. 13 6. Utilize a standardized format for presenting health 14 benefit plan options in the exchange, including the use of the 15 uniform outline of coverage established under section 2715 of 16 the Public Health Service Act and applicable state law. 17 7. In accordance with section 1413 of the federal Act 18 and applicable state law, inform individuals of eligibility 19 requirements for the Medicaid program under Tit. XIX of the 20 federal Social Security Act, the children’s health insurance 21 program under Tit. XXI of the federal Social Security Act, or 22 any applicable state or local public program and, if through 23 screening of an application by the exchange, the exchange 24 determines that any individual is eligible for any such 25 program, enroll that individual in that program. 26 8. Establish and make available by electronic means a 27 calculator to determine the actual cost of coverage after 28 application of any premium tax credit under the standards of 29 the federal Act to be codified at section 36B(c)(2)(C) of the 30 Internal Revenue Code of 1986 and any cost-sharing reductions 31 under section 1402 of the federal Act. 32 9. Establish a component of the exchange through which 33 qualified employers may access coverage for their eligible 34 employees and the employees can enroll in any qualified health 35 -8- LSB 2010YC (11) 84 av/rj 8/ 20

H.F. _____ benefit plan offered through the exchange at the level of 1 coverage specified by the employer. 2 10. Subject to section 1411 of the federal Act and 3 applicable state law, grant a certification attesting that, 4 for purposes of the individual responsibility penalty under 5 the standards of the federal Act, to be codified at section 6 5000A of the Internal Revenue Code of 1986, an individual is 7 exempt from the individual responsibility requirement or from 8 the penalty imposed by that section because of any of the 9 following: 10 a. There is no affordable qualified health benefit plan 11 available through the exchange, or the individual’s employer, 12 covering the individual. 13 b. The individual meets the requirements for any other such 14 exemption from the individual responsibility requirement or 15 penalty. 16 11. Transfer to the United States secretary of the treasury 17 all of the following: 18 a. A list of the individuals who are issued a certification 19 under subsection 10, paragraph “a” , including the name and 20 taxpayer identification number of each individual. 21 b. The name and taxpayer identification number of each 22 individual who was an employee of an employer but who was 23 determined to be eligible for the premium tax credit under 24 the standards of the federal Act to be codified at section 25 36B(c)(2)(C) of the Internal Revenue Code of 1986, because of 26 either of the following: 27 (1) The employer did not provide minimum essential health 28 benefits coverage. 29 (2) The employer provided the minimum essential health 30 benefits coverage, but it was determined under the standards 31 of the federal Act, to be codified at section 36B(c)(2)(C) of 32 the Internal Revenue Code of 1986, to either be unaffordable to 33 the employee or not to provide the required minimum actuarial 34 value. 35 -9- LSB 2010YC (11) 84 av/rj 9/ 20

H.F. _____ c. The name and taxpayer identification number of all of the 1 following: 2 (1) Each individual who notifies the exchange under section 3 1411(b)(4) of the federal Act that the individual has changed 4 employers. 5 (2) Each individual who ceases coverage under a qualified 6 health benefit plan during a plan year and the effective date 7 of that cessation. 8 12. Provide to each employer the name of each employee of 9 the employer described in subsection 11, paragraph “b” , who 10 ceases coverage under a qualified health benefit plan during a 11 plan year and the effective date of the cessation. 12 13. Perform duties required of, or delegated to, the 13 exchange by the secretary, the United States secretary of 14 the treasury, or the commissioner related to determining 15 eligibility for premium tax credits, reduced cost-sharing, or 16 individual responsibility requirement exemptions. 17 14. Review the rate of premium growth within the exchange 18 and outside the exchange, and consider the information obtained 19 in developing recommendations on whether to continue limiting 20 qualified employer status to small employers. 21 15. Credit the amount of any free choice voucher to the 22 monthly premium of the plan in which a qualified employee is 23 enrolled, in accordance with section 10108 of the federal Act, 24 and collect the amount credited from the offering employer. 25 16. Meet all of the following financial integrity 26 requirements: 27 a. Keep an accurate accounting of all activities, receipts, 28 and expenditures of the exchange and annually submit to the 29 commissioner a report concerning such accountings. 30 b. Fully cooperate with any investigation conducted by 31 the secretary pursuant to the secretary’s authority under the 32 federal Act, and allow the secretary, in coordination with the 33 inspector general of the United States department of health and 34 human services, to do all of the following: 35 -10- LSB 2010YC (11) 84 av/rj 10/ 20

H.F. _____ (1) Investigate the affairs of the exchange. 1 (2) Examine the properties and records of the exchange. 2 (3) Require periodic reports in relation to the activities 3 undertaken by the exchange. 4 Sec. 7. NEW SECTION . 514M.7 Navigators. 5 1. An exchange may select entities qualified to serve as 6 navigators in accordance with section 1311(i) of the federal 7 Act, standards developed by the secretary, and applicable state 8 law, and award grants to enable navigators to do all of the 9 following: 10 a. Conduct public education activities to raise awareness 11 of the availability of qualified health benefit plans through 12 an exchange. 13 b. Distribute fair and impartial information concerning 14 enrollment in qualified health benefit plans, and the 15 availability of premium tax credits under the standards of the 16 federal Act, to be codified at section 36B(c)(2)(C) of the 17 Internal Revenue Code of 1986, and any cost-sharing reductions 18 under section 1402 of the federal Act. 19 c. Facilitate enrollment through an insurance producer in 20 qualified health benefit plans through an exchange or in health 21 benefit plans outside an exchange. 22 d. Provide referrals to the office of health insurance 23 consumer assistance established under the federal Act pursuant 24 to section 2793 of the federal Public Health Service Act 25 and the office of the commissioner or any other appropriate 26 state agency, for any enrollee with a grievance, complaint, 27 or question regarding the enrollee’s health benefit plan, 28 coverage, or a determination under that plan or coverage. 29 e. Provide information in a manner that is culturally and 30 linguistically appropriate to the needs of the population being 31 served by an exchange. 32 2. All entities qualified as navigators that facilitate 33 enrollment in health benefit plans shall be licensed as 34 insurance producers or shall utilize the services of an 35 -11- LSB 2010YC (11) 84 av/rj 11/ 20

H.F. _____ insurance producer to assist in such facilitation. 1 3. All entities that provide facilitation for a navigator 2 shall be licensed as insurance producers. 3 Sec. 8. NEW SECTION . 514M.8 Health benefit plan 4 certification. 5 1. An exchange may certify a health benefit plan as a 6 qualified health benefit plan if the plan meets all of the 7 following criteria: 8 a. The plan provides the essential health benefit package 9 described in section 1302(a) of the federal Act, except that 10 the plan is not required to provide essential benefits that 11 duplicate the minimum benefits of qualified dental plans, as 12 provided in subsection 5, if all of the following occur: 13 (1) The exchange determines that at least one qualified 14 dental plan is available to supplement the plan’s coverage. 15 (2) The health carrier makes a prominent disclosure at the 16 time it offers the plan, in a form approved by the exchange, 17 that the plan does not provide the full range of essential 18 pediatric benefits and that qualified dental plans providing 19 those benefits and other dental benefits not covered by the 20 plan are offered through the exchange. 21 b. The premium rates and contract language have been 22 approved by the commissioner. 23 c. The plan provides at least a bronze level of coverage, 24 as that level is defined by the federal Act, unless the plan 25 is certified as a qualified catastrophic plan, meets the 26 requirements of the federal Act for catastrophic plans, and 27 will only be offered to individuals eligible for catastrophic 28 coverage. 29 d. The plan’s cost-sharing requirements do not exceed the 30 limits established under section 1302(c)(1) of the federal 31 Act, and if the plan is offered through the component of the 32 exchange that offers plans to small employers, the plan’s 33 deductible does not exceed the limits established under section 34 1302(c)(2) of the federal Act. 35 -12- LSB 2010YC (11) 84 av/rj 12/ 20

H.F. _____ e. The plan offers wellness programs. 1 f. The health carrier offering the plan provides greater 2 transparency and disclosure of information about the plan 3 benefits, provider networks, claim payment practices, and 4 solvency ratings, and establishes a process for consumers to 5 compare features of health benefit plans offered through an 6 exchange or exchanges that have been established or approved 7 pursuant to section 514M.4. 8 g. The health carrier offering the plan meets all of the 9 following criteria: 10 (1) Is licensed and in good standing to offer health 11 insurance coverage in this state. 12 (2) Offers at least one qualified health benefit plan in 13 the silver level and at least one qualified health benefit plan 14 in the gold level, as those levels are defined in the federal 15 Act, through each component of the exchange in which the health 16 carrier participates, where component refers to the components 17 of the exchange which offer individual coverage and coverage 18 for small employers. 19 (3) Charges the same premium rate for each qualified health 20 benefit plan without regard to whether the plan is offered 21 through the exchange. 22 (4) Does not charge any termination of coverage fees or 23 penalties in violation of section 514M.5. 24 (5) Complies with the regulations developed by the 25 secretary under section 1311(d) of the federal Act, applicable 26 state laws, and such other requirements as the exchange may 27 establish. 28 h. The plan meets the requirements of certification as 29 adopted by rule pursuant to this section and by the secretary 30 under section 1311(c) of the federal Act, which include but 31 are not limited to minimum standards in the areas of marketing 32 practices, network adequacy, essential community providers in 33 underserved areas, accreditation, quality improvement, uniform 34 enrollment forms and descriptions of coverage, and information 35 -13- LSB 2010YC (11) 84 av/rj 13/ 20

H.F. _____ on quality measures for health benefit plan performance. 1 i. The exchange determines that making the health benefit 2 plan available through the exchange is in the interest of 3 qualified individuals and qualified employers in the state. 4 2. An exchange shall not exclude a health benefit plan from 5 certification for any of the following reasons: 6 a. On the basis that the plan is a fee-for-service plan. 7 b. Through the imposition of premium price controls. 8 c. On the basis that the health benefit plan provides 9 treatments necessary to prevent patients’ deaths in 10 circumstances the exchange determines are inappropriate or too 11 costly. 12 3. An exchange shall permit individuals to learn, in a 13 timely manner upon the request of an individual, the amount 14 of cost-sharing, including deductibles, copayments, and 15 coinsurance, under the individual’s plan or coverage that the 16 individual would be responsible for paying with respect to the 17 furnishing of a specific item or service by a participating 18 provider. At a minimum, this information shall be made 19 available to the individual through an internet site and 20 through other means for individuals without access to the 21 internet. 22 4. An exchange shall not exempt any health carrier seeking 23 certification of a health benefit plan, regardless of the type 24 or size of the health carrier, from applicable state licensure 25 or solvency requirements and shall apply the criteria of this 26 section in a manner that assures a level playing field between 27 or among health carriers participating in the exchange. 28 5. a. The provisions of this chapter that are applicable 29 to qualified health benefit plans shall also apply to the 30 extent relevant to qualified dental plans except as modified in 31 accordance with the provisions of paragraphs “b” , “c” , and “d” 32 or by rules adopted by an exchange. 33 b. A health carrier shall be licensed to offer dental 34 coverage, but is not required to be licensed to offer other 35 -14- LSB 2010YC (11) 84 av/rj 14/ 20

H.F. _____ health benefits. 1 c. A qualified dental plan shall be limited to dental and 2 oral health benefits, without substantially duplicating the 3 benefits typically offered by health benefit plans without 4 dental coverage and shall include, at a minimum, the essential 5 pediatric dental benefits prescribed by the secretary pursuant 6 to section 1302(b)(1)(J) of the federal Act, and such other 7 dental benefits as an exchange or the secretary may specify by 8 regulation or rule. 9 d. Health carriers may jointly offer a comprehensive plan 10 through an exchange in which the dental benefits are provided 11 by a health carrier through a qualified dental plan and the 12 other benefits are provided by a health carrier through a 13 qualified health benefit plan, provided that the plans are 14 priced separately and are also made available for purchase 15 separately at the same price. 16 Sec. 9. NEW SECTION . 514M.9 Funding —— publication of 17 costs. 18 1. An exchange may charge assessments or user fees to health 19 carriers that offer health benefit plans through the exchange 20 or may otherwise generate the funding necessary to support the 21 operation of the exchange, as provided pursuant to the plan of 22 operation of the exchange. 23 2. An exchange shall publish the average costs of licensing, 24 regulatory fees, and any other payments required by the 25 exchange, and the administrative costs of the exchange, on an 26 internet site for the purpose of educating consumers about the 27 costs of operating the exchange. The information provided 28 shall include information on moneys lost due to waste, fraud, 29 and abuse of the health care system. 30 Sec. 10. NEW SECTION . 514M.10 Rules. 31 The commissioner shall adopt rules pursuant to chapter 17A 32 to administer the provisions of this chapter. Rules adopted 33 under this section shall not conflict with or prevent the 34 application of regulations promulgated by the secretary under 35 -15- LSB 2010YC (11) 84 av/rj 15/ 20

H.F. _____ the federal Act. 1 Sec. 11. NEW SECTION . 514M.11 Advisory committee —— risk 2 adjustment. 3 The commissioner shall establish an advisory committee 4 within the division of insurance of the department of commerce 5 to develop a risk adjustment mechanism that will apportion 6 risk among the health carriers providing defined contribution 7 health benefit plans, to protect those health carriers from 8 the risks of adverse selection. The commissioner may delegate 9 the responsibility for development of this mechanism to an 10 exchange. 11 Sec. 12. NEW SECTION . 514M.12 Relation to other laws. 12 This chapter, and action taken by an exchange pursuant to 13 this chapter, shall not be construed to preempt or supersede 14 the authority of the commissioner to regulate the business 15 of insurance in this state. Except as expressly provided to 16 the contrary in this chapter, all health carriers offering 17 qualified health benefit plans in this state shall comply fully 18 with all applicable health insurance laws of this state and 19 rules adopted and orders issued by the commissioner. 20 Sec. 13. FUTURE REPEAL. If the federal Act is repealed 21 by federal legislation or is ruled invalid by a federal court 22 decision, chapter 514M is repealed effective twelve months 23 after the effective date of such federal legislation or after 24 the date of the federal court decision. 25 Sec. 14. CONTINGENT EFFECTIVE DATE. This Act takes effect 26 six months prior to the date upon which an exchange is required 27 by federal law to be operational. 28 EXPLANATION 29 This bill authorizes the establishment of health insurance 30 exchanges in the state. 31 The bill creates new Code chapter 514M, which authorizes the 32 establishment of health insurance exchanges in the state to 33 facilitate the purchase and sale of qualified health benefit 34 plans in the individual market in this state and to assist 35 -16- LSB 2010YC (11) 84 av/rj 16/ 20

H.F. _____ qualified small employers in facilitating the availability 1 of qualified health benefit plans offered in the small group 2 market. The intent of establishing of such exchanges is 3 to reduce the number of uninsured, provide a transparent 4 marketplace and consumer education, and assist individuals 5 with access to programs, premium assistance tax credits, and 6 cost-sharing reductions. 7 A health insurance exchange shall be established in the 8 state, and subject to the discretion of the commissioner of 9 insurance, may be operated by the insurance division of the 10 department of commerce or as a nonprofit corporation approved 11 by the commissioner. The commissioner is required to approve 12 the establishment of one or more exchanges in the state that 13 meet the requirements of new Code chapter 514M. An exchange 14 or components of an exchange may be operated on a statewide 15 or regional basis, or on a multistate basis, subject to the 16 approval of the commissioner. Such an exchange shall be 17 operated pursuant to a plan of operation approved by the 18 commissioner. 19 All persons who enroll in a qualified health benefit plan 20 offered through an exchange must be enrolled by an insurance 21 producer who is licensed as provided in Code chapter 522B. The 22 health carrier that issues the qualified health benefit plan 23 selected must pay the insurance producer a commission of at 24 least 5 percent of the premium paid by the enrollee. If a 25 health carrier offers health benefit plans outside an exchange, 26 the health carrier must also pay the producer involved in the 27 sale a commission of at least 5 percent of the premium paid by 28 the enrollee. 29 An exchange may contract with an eligible entity to 30 fulfill any of its responsibilities as described in new Code 31 chapter 514M. An eligible entity includes an entity with 32 experience in individual and small group health benefit plans, 33 benefit administration, or other experience relevant to the 34 responsibilities to be assumed by the entity, but does not 35 -17- LSB 2010YC (11) 84 av/rj 17/ 20

H.F. _____ include a health carrier or its affiliate. An exchange may 1 also enter into information-sharing agreements with federal 2 and state agencies and other state exchanges if there are 3 adequate protections with respect to the confidentiality of the 4 information to be shared. 5 An exchange established or approved pursuant to Code section 6 514M.4 is required to make qualified health benefit plans 7 that are effective on or before January 1, 2014, available 8 to qualified individuals and qualified employers. Such an 9 exchange is also required to request a five-year waiver from 10 the secretary of the United States department of health and 11 human services of the certification requirements for health 12 benefit plans of the federal Patient Protection and Affordable 13 Care Act (PPACA), to enable the exchange to offer mandate-free 14 health benefit plans that are exempt from some or all of 15 the special health and accident insurance coverages required 16 pursuant to the federal Act or Code chapter 514C. 17 An exchange or a health carrier offering qualified health 18 benefit plans through the exchange cannot charge an individual 19 a fee or penalty for termination of coverage if the individual 20 enrolls in another type of minimum essential coverage because 21 the individual is newly eligible for that coverage or because 22 the individual’s employer-sponsored coverage has become 23 affordable. 24 The bill specifies the duties of an exchange to carry out 25 the intent of the Code chapter consistent with the PPACA and 26 state law. The bill authorizes an exchange to select entities 27 to serve as navigators and to award grants to enable navigators 28 to conduct public education activities; distribute fair and 29 impartial information concerning enrollment in qualified health 30 benefit plans including the availability of premium tax credits 31 and cost-sharing reductions; facilitate enrollment through an 32 insurance producer in health benefit plans through or outside 33 the exchange; provide referrals to the federal office of health 34 insurance consumer assistance; and provide information that is 35 -18- LSB 2010YC (11) 84 av/rj 18/ 20

H.F. _____ culturally and linguistically appropriate to the needs of the 1 population being served by the exchange. Entities qualified as 2 navigators that facilitate enrollment in health benefit plans 3 must be licensed as insurance producers or utilize the services 4 of an insurance producer to assist in such facilitation. All 5 entities that provide facilitation for a navigator shall be 6 licensed as insurance producers. 7 An exchange is given parameters for certifying health 8 benefit plans as qualified health benefit plans. Under the 9 PPACA, only qualified health benefit plans can be sold through 10 an exchange and a health benefit plan must be certified as 11 meeting certain minimum standards specified in the PPACA 12 and in new Code chapter 514M to be certified as a qualified 13 health benefit plan. Also, a health carrier must meet certain 14 standards in order to have its plans certified so that the 15 plans can be offered through an exchange. 16 An exchange is authorized to charge assessments or user fees 17 to health carriers that offer health benefit plans through 18 the exchange, or to otherwise generate the funding necessary 19 to support the operation of the exchange, as provided in the 20 plan of operation of the exchange. An exchange is required 21 to publish the average costs of licensing, regulatory fees, 22 and any other payments required by the exchange and the 23 administrative costs of the exchange on an internet site, to 24 educate consumers about the costs of operating the exchange. 25 The commissioner of insurance is required to adopt rules 26 pursuant to Code chapter 17A to administer the provisions of 27 the new Code chapter. 28 The commissioner is required to establish an advisory 29 committee or delegate the responsibility to an exchange, to 30 develop a risk adjustment mechanism that will apportion risk 31 among the health carriers providing defined contribution health 32 benefit plans, to protect those health carriers from the risks 33 of adverse selection. 34 The bill takes effect six months prior to the date upon 35 -19- LSB 2010YC (11) 84 av/rj 19/ 20