At the invitation of executives with Health Affairs, Rose Naff, Chief Executive Officer of Florida’s Health Insurance Marketplace, spoke with reporters at the National Press Club in Washington, D.C. on July 17, 2012.  Following are her remarks:

Thank you for that introduction and, as Susan said, I am Rose Naff, CEO of Florida Health Choices, Inc.  Although I lead an organization created by the state, I am not a state employee and I do not represent the State of Florida here today. 

Florida’s Marketplace was created by law in 2008.  It was one of House Speaker Marco Rubio’s 100 great ideas for Florida.

At Florida Health Choices, we are implementing state law and the recent decision by the Supreme Court of the United States does not change state law or our mission.

The program will be phased in, and it is voluntary.  We would like to make it easier for agents and employers to do the business of insurance and provide more choice for employees and individuals.

The Marketplace will be a 24/7, on-line, place to shop with side by side comparison with some similarity to an American Health Benefit Exchange but the comparison stops right there because:

  • We do not mandate the benefits
  • We do not negotiate rates
  • There are no subsidies available
  • No penalties
  • It is not limited to comprehensive health insurance products
  • There are no complex eligibility interfaces
  • We set our own goals
  • There is no legal deadline for implementation

Still, we’ve been at this for two years already so we have some experience and there are things that other states should know:

A.    A resource drain is inevitable.  Be first, or be last.  The states in the middle will get the 3rd and 4th string.

There are lots of venders prancing around looking for a piece of the action.  A few seem capable enough but no one has a deep enough bench.

I have seen antiquated solutions built on 1990’s technology.  I have seen immature solutions building on the most modern stuff.

B.     The reality is no one company is doing the whole package. 

This is a teaming environment and the teams keep changing depending on the politics of the state or the procurement specifications. 

If a state will operate its own Exchange I advise them to look for solutions and teams that are consistent across the country.

C.     Cost estimates are all over the map – meaning nobody really knows that it takes.

Consultants gave us an estimate of $8-14 million to build our Marketplace but we are building it for $4.3 million.

The same consultants estimated $20-40 million if we were to build an American Health Benefit Exchange under the Affordable Care Act.

But I’ve read recently that some states have awarded contracts for an Exchange build exceeding $100 million.

So how much does it really cost?  So far, the answer is somewhere between $4.3 million and $100 million.

D.    It is inevitable that there will be some failures.

We have had our own setbacks but we will implement the program when systems are ready and not before. 

When we do launch the Marketplace, we are expecting a slow uptake.  It takes about 60-70,000 participants to make the program self-sustaining. 

Enrolling 1-percent of the small group market in Florida would be about 90,000 lives.

Thank you and I am happy to take any questions.