Tennessee Health Insurance Exchange Guide

This guide provides an overview of the Tennessee Health Insurance Exchange including the history of the exchange, how the exchange will operate, and exchange information for Tennessee residents and small businesses.

Tennessee Health Insurance Exchange Introduction

As a quick overview, beginning in 2014 as part of the Affordable Care Act (ACA), health insurance coverage for individuals and small businesses will become available through new state health insurance exchanges (also called health insurance marketplaces).

Most importantly, the key tax credits (e.g. the small business healthcare tax credits) and tax subsidies (e.g. individual health insurance tax subsidies) will only be available for coverage purchased through a state health insurance exchanges.

All states have three options for setting up a state health insurance exchange for 2014:

1. Build a state-based exchange, 
2. Enter into a state-federal partnership exchange, or
3. Default to a federally-facilitated exchange.

Tennessee will default to a federally-facilitated health insurance exchange. The Tennessee Health Insurance Exchange will open for enrollment on October 1, 2013, with coverage starting January 1, 2014.

Tennessee Health Insurance Exchange - History

According to the Tennessee state website, Tennessee created an Insurance Exchange Planning Initiative in 2010 to review Tennessee’s options for a state health insurance exchange, and advise state decision-makers. The Exchange Planning Initiative met with small businesses, agents and brokers, health care providers, insurers, consumer advocates, and other stakeholders to discuss the state's options.

On December 10, 2012 Governor Haslam announced that Tennessee would not operate a state-based exchange. Therefore, Tennessee will default to the federally-run health insurance exchange.

Tennessee Health Insurance Exchange - What is It?

The Tennessee Health Insurance Exchange will be operated through a federally-run health insurance exchange, also referred to as the Health Insurance Marketplace. Starting in October 2013, Tennessee residents will be able to access information about all the plans available through the Exchange. The SHOP Exchange will also be available to small businesses with 100 or fewer employers. Coverage from the Exchange starts in January 2014.

A key part of the Tennessee Health Insurance Exchange is that eligible individuals and families will be able to access individual tax subsidies, capping the cost of their premium between 2% to 9.5% of income. Eligibility is based on household size and income (up to 400% FPL). The Exchange will also screen for Medicaid and public assistance programs.

According to an estimate by healthcare.gov, approximately 889,000 or 16% of Tennessee’s non-elderly residents are uninsured, of whom 834,200 (94% of these) may qualify for either tax subsidies to purchase coverage in the Marketplace or for Medicaid, if Tennessee participates in the Medicaid expansion.

Tennessee Health Insurance Exchange - What Plans will be Available?

All plans offered through the Tennessee Health Insurance Exchange will meet the ACA definition of a Qualified Health Plan (QHP). The plans will be offered by level of coverage for essential health benefits (EHB), to allow consumers to compare plans on an "apples to apples" basis.

The four "metal" levels are: Bronze (plan pays 60%), Silver (plan pays 70%), Gold (plan pays 80%), and Platinum (plan pays 90%). More information on the types of plans that will be available, and the carriers offering plans in Tennessee, is expected by late summer 2013.

Tennessee Health Insurance Exchange - Role of Insurance Professionals & Navigators

The Tennessee Health Insurance Exchange will follow federal guidelines for insurance professionals selling policies through the Exchange and for navigators assisting consumers and small businesses.

Insurance professionals will be able to register with the Exchange and receive any commissions directly from the carriers (using their Exchange ID number and NPN). 

The Tennessee Health Insurance Exchange navigator program will assist consumers in making choices about their health care options and accessing their new health care coverage, including access to premium tax credits for eligible consumers. The federal government will run the navigator program in Tennessee.

Further details on the Tennessee Health Insurance Exchange insurance broker and navigator programs are expected this summer.