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States' deadline for health insurance exchange plan notification extended

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States' deadline for health insurance exchange plan notification extended

The Obama administration is giving states one more month to notify federal regulators on whether they will set up health insurance exchanges.

In a letter sent Thursday to Republican Govs. Bob McDonnell of Virginia and Bobby Jindal of Louisiana and to the Republican Governors Association, U.S. Department of Health and Human Services Secretary Kathleen Sebelius said the original Nov. 16 deadline will be extended to Dec. 14.

Ms. Sebelius noted in her letter than the Republican governors had asked for an extension of the Nov. 16 deadline. “We will continue to work directly with individual states to address their particular questions and concerns,” Ms. Sebelius wrote.

Under the Patient Protection and Affordable Care Act, which authorized the exchanges, states have three options. They can set up their own exchanges, operate exchanges in partnership with the federal government, or decline to set up exchanges. The exchanges, starting on Jan. 1, 2014, will be available to the low-income uninsured to obtain coverage with federal premium subsidies, as well as to small employers, among others.

Observers describe the notification delay as a savvy decision.

The delay “comes in response to a specific request from governors and it makes good practical sense to give states that had awaited the results of the Nov. 6 elections a few more weeks to firm up their decisions as additional regulations come out swiftly,” said Frank McArdle, an independent benefits consultant in Bethesda, Md.