Pennsylvania plans to move away from participating in the federal health insurance exchange and to establish its own exchange in time for the 2021 open enrollment season.

The shift away from using the federal exchange and developing a state-based exchange was approved by Pennsylvania’s General Assembly earlier this year.  That shift took a major step forward recently when the state hired a contractor to create the site’s platform.

State officials estimate that once the state’s site is up and running it will costs $25 million a year to operate; currently, Pennsylvania pays $95 million a year to participate in the federal exchange.  In addition, the state will be able to collect the three percent of premiums that insurers pay to appear on the federal site.  Those seeking insurance on the new state site should  benefit, too, with state officials estimating that purchasing reinsurance will enable consumers to save five to ten percent on premiums.

For an update on the status of the development of Pennsylvania’s health insurance exchange, see the Fierce Healthcare article “Pennsylvania takes another step toward launching state-based insurance exchange.”