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State Exchange Profiles: Texas


Final update made on December 11, 2012 (no further updates will be made)

Establishing the Exchange

On July 9, 2012, Governor Rick Perry (R) announced that Texas would not establish an exchange.1 Prior to this announcement, the Department of Insurance and the Health and Human Services Commission had partnered to explore exchange implementation plans.2 Using federal grant funding they identified subcontractors to assist with the exchange planning process, to collect stakeholder feedback, and to investigate the state’s policy options. In addition, Texas held a public exchange planning symposium and solicited public comments in early 2011.3

Essential Health Benefits (EHB): The ACA requires that all non-grandfathered individual and small-group plans sold in a state, including those offered through the Exchange, cover certain defined health benefits. In August 2012, the Texas Department of Insurance held a public forum to discuss stakeholder feedback on the possible EHB benchmark plans.4 Texas did not put forward a recommendation and the state’s benchmark EHB plan will default to the largest small-group plan in the state, Blue Cross Blue Shield of Texas- BestChoice PPO.

Exchange Funding

The Texas Department of Insurance received a federal Exchange Planning grant of $1 million in 2010, though the state has since returned $900,000 of this grant to the federal government.5

Next Steps

The federal government will assume full responsibility for running a health insurance exchange in Texas beginning in 2014.

1. Press Release from Governor Rick Perry. “Gov. Perry: Texas Will Not Expand Medicaid or Implement Health Benefit Exchange.” July 9, 2012.
2.Ramshaw E. “Perry Rejects ‘Obamacare,’ But State Agency Pushes On.” The Texas Tribune. June 20, 2011.
3. “Federal Healthcare Reform- Exchange Planning Symposium. Background Information and Requested Stakeholder Input.” February 14, 2011.  (Access August 15, 2011)
4. Texas Department of Insurance. “Essential Health Benefits.” (Accessed September 5, 2012).
5. Tan, Thanh. “Health Leaders Say They’re Ready for Federal Reforms.” The Texas Tribune. February 27, 2012.

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