State RegulationsTX specificDifficulty 2/5
Texas has not elected to establish a state-based health insurance exchange. What is the consequence for Texas residents and for the agents who assist them?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under ACA Section 1321, a state may elect to establish a state-based exchange; if it does not, the federal government must establish and operate a federally facilitated exchange in that state. Texas did not establish a state exchange, so consumers and their agents use the federally facilitated Marketplace, where premium tax credits and cost-sharing reductions remain available; the agent still must hold a Texas license and appointment to solicit and enroll, because federal operation of the exchange does not displace Texas licensing law.
Why the other options are wrong
- A) Exchanges are established at the state level or by the federal government, never county by county.
- B) Marketplace coverage is available in Texas; ACA Section 1321 requires the federal government to operate an exchange where the state has not created one.
- C) The department regulates insurers and agents in Texas; it does not operate the Marketplace, which is a federal function under ACA Section 1321 in a state like Texas.
Memory hook
No state exchange means federal Marketplace, Texas license still required.