What Peter Lee means for the Exchange…

California’s new Health Benefits Exchange has named its first Executive Director, Peter Lee, as it prepares to create a purchasing pool that in 2014 and beyond will provide more affordable, federally subsidized, coverage to millions of Californians.

We’ve already posted the press release from the Exchange, and its got some coverage, but we also want to send our Congratulations to Peter as he assumes his new role creating a new consumer-friendly marketplace of the future, to dramatically help Californians to get affordable health coverage. Whether in his current role at the Center for Innovation at CMS/HHS in the Obama Administration, or his previous leadership role at the Pacific Business Group on Health, Peter has been a longtime champion of large purchasers using their bargaining power to get the best value in coverage and care. It’s appropriate he will lead the effort to allow millions of Californians to pool together to bargain for the best price and value with the insurance industry.

Why does this pick matter? With this pick, the Exchange is being clear that not only do they have the authority to negotiate with insurers for the best value, they plan to actively use it. This Exchange will be transformative–a sea-change from the current individual market where consumers and small businesses are left all alone at the mercy of the big insurers.

Peter Lee will have the opportunity to structure a market where insurers compete based on cost and quality, customer service and wellness, rather than how effectively they avoid people who need care, and confuse the rest of us with the complexity of their benefits.

We welcome a director who has experience as a consumer advocate. Peter Lee had been director of the Center for Health Care Rights, where we worked with him on consumer protections and other issues. The point of the Exchange is to empower the consumer, by providing good information about coverage and care, by providing subsidies to make coverage affordable, and by pooling together their bargaining power to vet products and gets the best price and value. Lee’s background will be helpful in fulfilling the promise that California families have an ally on their side, as they try to navigate the health insurance marketplace.

California was the first state in the nation to take this central step of implementing the new federal health reform law by passing legislation in 2010, AB 1602 (Perez) and SB 900 (Alquist/Steinberg), to establish a new health insurance Exchange. Many other states have followed suit this year.

In 2014, the new Exchange will be the new one-stop shop for getting health coverage for individuals and small businesses, both providing easy-to-compare choices, access to federally-funded subsidies to make coverage affordable, and the bulk purchasing power (similar to large employers or CALPERS) of millions of Californians to bargain for the best price and value.

The chair of the Exchange board is Governor Brown’s Secretary of Health and Human Services, Diana Dooley. Governor Schwarzenegger appointed two of his top aides, his chief of staff Susan Kennedy and his secretary of health and human services secretary Kim Belshe. Assembly Speaker John Perez made his appointment of Paul Fearer, a Union Bank executive who is chair of the board of the Pacific Business Group on Health. The Senate Rules Committee, chaired by Senate President Pro Tem Darrell Steinberg, recently appointed Dr. Bob Ross, CEO of The California Endowment. The appointments are subject to important conflict-of-interest requirements that they do not represent health insurers or the industry, so the Exchange can freely negotiate on behalf of consumers and purchasers.

An estimated 3-4 million or more Californians who will be eligible to participate in the exchange starting 2014 (and more in future years as larger employers are allowed to join in).

Health Access California promotes quality, affordable health care for all Californians.
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