Building a Market-Based Health-Insurance Exchange in New York

This Manhattan Institute analysis, conducted with NYHealth support, provides a vision of a market-based exchange in New York State, arguing that the exchange should function as a clearinghouse for all qualified health plans. Its recommendations include greater flexibility in insurance design, an expansion of age-banding to allow lower cost plans for younger and healthier enrollees, and a defined contribution mechanism for small businesses.

States have  the ability and flexibility to make choices when establishing new insurance exchanges, which are key linchpins of Federal health reform. Exchanges will serve as central marketplaces where individuals and employers can access all public and subsidized private insurance options. If the exchanges function as planned, they will expand coverage, improve the quality of coverage, and perhaps reduce costs.

This report includes a review of several exchange and exchange-like programs and includes a number of lessons learned and recommendations that can help policymakers structure an effective market-based exchange in New York that can help consumers and small businesses choose from a wide range of flexible and affordable health-insurance options.

For another view on establishing exchanges in New York State, read the United Hospital Fund report.