A new bill proposed last week in the Rhode Island Senate would establish one of the first state health benefits exchanges.  Such exchanges, as contemplated by the federal Patient Protection and Affordable Care Act (PPACA), will permit individuals and small businesses to compare health insurance plans and purchase coverage.

The Rhode Island bill proposes the creation of a quasi-public corporation to operate the exchange, which would not technically be part of the state government.  It would be funded at first by the federal government.  Initially, the exchange would likely be a simple website providing information on competing plans; by January 1, 2012, the exchange’s directors would be required to report back to the state General Assembly with suggestions on expanding its functionality.  The exchange would be governed by an executive board including the state health insurance commissioner, the secretary of health and human services, the state administration director and eight people appointed by the governor.

PPACA, which requires most Americans to purchase health insurance, requires state exchanges to be operational by January 1, 2014.