Definition of health exchange HIX health insurance exchange

Health insurance exchanges were launched in the US in October 2013 as part of a radical overhaul of the American health system brought in by President Barack Obama under Obamacare.

Health insurance exchanges are online marketplaces for purchasing health insurance. They are aimed at low to middle income Americans who were previously unable to afford health insurance cover, although anyone is permitted to use them, The exchanges allow potential customers to compare insurance policies on levels of cover and price. They were expected to result in lower premiums for most users and vastly lower premiums for others.

At launch on October 1 2013, premiums for lower level coverage were capped at 9.5% of income for those earning between 300 per cent and 400 per cent of the Federal Poverty Line. There is a sliding scale so those earning less would pay less. Unlike in the open insurance marketplace, no insurance policy on the health insurance exchanges can refuse someone coverage for a pre-existing medical condition.

The new policies were due to become effective in January 2014.

Before the launch of the scheme some experts estimated that Americans with health coverage would expect to pay about 20 per cent of their income on health insurance.

 

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Nearly 3m Americans were reported to have visited the new health exchanges on the first day of business. 

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