Several state-run public exchanges got a shot in the arm from the Centers for Medicare & Medicaid Services, which awarded $187 million in grants to help develop their respective operational visions before federal funding runs out.

Nearly $100 million of those funds were earmarked for Arkansas, the only one of five grant recipients that’s said to be actively working to establish its own solution. Arkansas, which has crafted an alternative to Medicaid expansion held up as a model for other conservative states, hopes that its SHOP exchange will be up and running by next year with an individual exchange to follow in 2017. 

The other four states receiving grants include New York ($64 million), Connecticut and Massachusetts (nearly $10 million apiece), and Rhode Island (about $3 million). More than $3 billion in grants have been earmarked to 16 states and the District of Columbia to establish their own exchanges under the Affordable Care Act.

Also see: Brokers, consumers ‘at a standstill’ in Arkansas

Despite a requirement that state-run exchanges be self-sufficient by Jan. 1, 2015, many are expected to continue relying on federal grants next year until they find viable long-term funding. Former CMS Administrator Marilyn Tavenner noted during a recent congressional hearing that most of those states depend on user fees and other revenue sources, and that discussions with some of the smaller states about future funding are ongoing. 

“Arkansas bears both the operational responsibility and accountability for making an exchange happen,” says Larry McNeely, policy director for the National Coalition on Health Care in Washington, D.C.

In spite of the state’s conservative bent, he’s encouraged by an attempt to resolve problems in a bipartisan fashion rather than fuel the critical fire over the ACA. “They’ve put together a big payment reform initiative that’s going to save money and improve care, even for the most vulnerable folks on Medicaid in that state,” according to McNeely.

He’s hopeful that even with a new Republican governor who just replaced his Democrat predecessor “that Arkansas can continue to be the exception to the rule, where you have conservative states that really engage in trying to solve these problems.”

The shared goals of all state exchanges is that they do whatever they can to ensure there’s “a functioning insurance marketplace,” as McNeely describes it, which includes promoting competition and good-value products for consumers.

One interesting side note is the key differences between neighboring states Connecticut and Massachusetts, whose exchanges have been cited as among the nation’s best and worst run, respectively.

“It’s a tale of two states in some respects,” McNeely acknowledges, noting that the Massachusetts Health Connector HIX had a long track record and served as a model for the ACA before running into technical and operational difficulties that led state officials to seriously consider switching to “States are going to adapt solutions to their own situation, some of which are going to work better than others.” 

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