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Understanding health insurance exchanges

As the provisions of the Patient Protection and Affordable Care Act (PPACA) went into effect, one significant change arose in the way consumers can obtain health insurance. If a worker's employer does not offer a health care plan, he or she can buy it directly from a Health Insurance Exchange (HIX).

What is an insurance exchange?

These are transparent marketplaces that allow consumers in each state — as well as small businesses (those with 100 or fewer employees) — to compare and shop among affordable, quality health insurance options.

Who offers the exchanges?

HIXs are offered through state and federal government entities, and are subject to state regulation, standardization and oversight. The insurance plans offered within the exchanges will be from private insurers.

What are the advantages?

The Department of Health and Human Services lists these advantages for consumers:

Lower costs: Due to increased competition and pooled resources, small businesses, individuals, and families can purchase insurance at rates similar to what large businesses enjoy today.
One-stop shopping: The exchanges give consumers tools to effectively compare benefits, pricing, and quality.
Greater benefits and protection: Exchanges give families and small businesses access to plans offering high quality benefits. Tax credits and reduced cost sharing may also be possible, depending on a person's income.

Visit HealthCare.gov to learn more about health insurance exchanges and what they might mean to you.

To find out how State Farm^® may be able to help with your health insurance needs, contact your agent today.

The information in this article was obtained from various sources not associated with State Farm^® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.