Nevada wins grant authority to implement health insurance exchange

Nevada's health exchange, which will offer residents a one-stop shop to obtain medical insurance beginning Oct. 1, 2013, has received federal approval for grant funding to move forward with its implementation.

Jon Hager, executive director of the Silver State Health Insurance Exchange, told the board overseeing the effort Thursday that a $50 million grant commitment has been received from the U.S. Department of Health and Human Services. The money won't actually come to the state until claims are submitted, he said.

Much of the funding will be used to pay a portion of a $72 million contract between the state and Xerox State Healthcare to set up and operate the information technology system needed to implement the exchange.

In total, the state has received authority for the full amount sought, $74.8 million, to set up its exchange. Nevada is one of six states to receive a Level 2 grant award for its exchange, Hager said.

Gov. Brian Sandoval has said he supports the development of a Nevada-based exchange so it can be tailored to fit the needs of Nevada residents. The alternative would be to have the federal government operate an exchange in the state.

The federal government is paying for more than 99 percent of the cost of implementing and operating the exchange through Dec. 31, 2014. After that, the state must find money to fund it.

The board voted in August to assess fees on participants to fun exchange operations. Sandoval has said the exchange should "stand on its own merits through user fees."