Health Exchanges (Marketplaces)

Health Exchanges: Purchasing Major Medical

Purchasing Major Medical Insurance

Health Exchanges are set up to facilitate the purchase of health insurance. Each state has the option to run their own State Based Exchange or to participate in the Federally Facilitated Marketplace (FFM). 

On-Exchange

Off-Exchange

State Based Marketplace (SBM)

"On-exchange" health plans, are

only available to purchase from

the Federally Facilitated Marketplace (FFM).

"Off-exchange" health plans can only be bought

privately, directly from the carrier.

Consumers can purchase On or Off-exchange plans through the SBM. Off exchange plans can

also be bought directly from the carrier.

Federal subsidies (tax credits) are available to qualifying consumers Federal subsidies are not available Only on-exchange plans will qualify for subsidy

Summary:

  • On-exchange plans in non-SBM states are purchased through the FFM.
  • Off-exchange plans in non SBM states are not purchased through an exchange but instead with the insurance carrier, directly.  
  • State based marketplaces (SBMs) offer on and off-exchange plans to consumers through their state managed marketplace.
  • Note: if a consumer wants to purchase an off-exchange plan in an SBM state, they also have the option of purchasing from the carrier directly. 

State Based Marketplaces

SBMs

States that operate their own Marketplace (as oppose to the Federal Marketplace) are known as State Based Marketplaces. 

States running a State-based Marketplace are responsible for performing all Marketplace functions. Consumers in these states apply for and enroll in coverage through Marketplace websites established and maintained by the states (not the FFM).

Major Medical plans purchased in through a State Based exchange will still follow all rules outlined in the ACA. 

For 2016, there are 13 State-based Marketplaces.