2014 Insurance Exchange Funding Now Available

The Obama administration on Friday announced funds for states to move ahead with online health insurance exchanges set to launch in 2014, despite uncertainty over whether opponents will strike down the healthcare law mandating such e-marketplaces before then.

The exchanges, akin to online travel sites, are intended to help people research and purchase individual or small business insurance plans at competitive prices. The websites will require complex infrastructures for protecting patient privacy and determining eligibility. No federal funding had been available up until now.

Friday's announcement did not say how much money will be available. The funds, to be awarded through competitive grants, will support the design and deployment stages of development.

Administrations say states have been requesting financial assistance.

"For the first time, funding will be directed to states that are willing and able to lead the race to develop IT systems. These systems can then be used as models by all states in their efforts to establish exchanges," the Health and Human Services Department announced in a statement.

Some states already have working models. Massachusetts launched an exchange a few years ago called Health Connector that displays commercial and publicly subsidized health insurance options to state residents.

The two-year grants will be awarded by Feb.15, 2011, to at most five states or groups of states with feasible proposals for IT setups that all states would be able to replicate.