NU Online News Service, March 7, 3:25 p.m. EST

Every state will have a health insurance exchange—whether operated by a particular state or by the federal government—when the system is scheduled to be implemented on Jan. 1, 2014, the head of the government bureau implementing the healthcare law says.

Clearly the launching of exchanges system will rest on whether the Patient Protection and Affordable Care Act (PPACA) is upheld by the Supreme Court, says Steve Larsen, deputy administrator and director of the Center for Consumer Information and Insurance Oversight (CCIIO) at the Department of Health and Human Services. The CCIIO is part of the Centers for Medicare and Medicaid Services.

“It will be one of the most important decisions [by the court] in a long time,” he says.

As to the final rule implementing the exchanges, Larsen indicates that the release is imminent.

He used the words, “very soon” and “very close” in discussing the exchange regulations, but an aide declined to confirm or deny whether those rules are resting with the Office of Management and Budget, which has the final say in approving a proposed or final federal regulation.

Larsen made his comments yesterday as the opening speaker at the 2012 National Policy Forum of America’s Health Insurance Plans, being held yesterday and today in Washington.

At the same time yesterday, HHS released on the National Association of Insurance Commissioners’ website the latest revised version of its “recommended approach” for an updated state-specific threshold for rate increases.

It appears HHS has determined that the threshold for examining proposed rate increases by insurance companies will remain at 10 percent.

In the announcement, CCIIO says, “…based on available data, it appears that medical costs are not increasing at a faster rate than they were in December 2010, when the proposed regulation was published.”

The proposal adds, “This would appear to argue against any increase in the threshold for reviewing rate increases.  The process described below would provide an opportunity for States to present evidence of unique conditions that would justify a threshold higher than 10 percent.  However, HHS would be more inclined to grant a request from a State that the threshold be lower than 10 percent.”

Larsen says that HHS reviewed 12 proposed rate increases in states where the governments declined to get involved, and found that 6 were unreasonable increases and 6 were not.

The comment period on the proposal ends March 12th.

Larsen also says that HHS has completed reviews of 18 state requests for exemptions or exceptions on the medical loss ratio formula, rejecting 11, adjusting six and fully approving Maine’s request.