Officials say they have three avenues to choose from:

• A state-based exchange built from scratch.
• A federal exchange where the government facilitates healthcare-insurance choices for employers and individuals.
• A blended plan utilizing federal and state resources to implement health-insurance purchasing.

Jeremiah Samples, insurance program manager for West Virginia, said before any decision is made, it is important to understand the costs involved in a federal program, but he noted that such an analysis is not possible until HHS issues the rules.

A state could move ahead with implementation, he added, but it would be a huge problem to “unplug” the program if other programs are found to be more cost effective.

“It is critical to get this right in the beginning,” said Samples. He said it is necessary “to ask the questions now and not later.”

Martin Swanson, assistant project director for the Nebraska Insurance Department, said there are some 200 instances of rulemaking that the state is waiting on before it can make an educated decision on what to implement.

He said the only decision that has been made is that whatever form the exchange takes, it will be housed in the state's insurance department

Swanson went on to say that there are many component healthcare programs that need to be integrated into the exchanges, including Medicaid, which he said is a whole different system from other health programs. Information from federal counterparts on how that would fit into an exchange program is vital to making the system cohesive.

“We encourage our federal friends to get us an answer as soon as possible,” he stated.

Herb Olson, legal counsel for the state of Rhode Island Office of the Health Insurance Commission, said his state is moving ahead “full tilt” with implementation of its exchange, including the appointment of a new director of Health Benefits Exchange, Christine Ferguson.

However, Olson said rulemaking finalization is essential to developing “regulatory alignment,” and getting decisions right the first time so states do not lose good health programs they have developed that do not fit into the PPACA. He also warned of a fragmented system of regulation if regulations are not developed properly.

Attempting to address some of the regulators' concerns, Tim Hill, deputy director for the Center for Consumer Information and Insurance Oversight, a part of the Centers for Medicare and Medicaid Services, said HHS wants the states to be “in this process.”

He said, “We want to meet the states where it is comfortable for them,” adding the federal government does not want to be the referee over the state health exchange markets.

Addressing the transmission of data between State and federal departments, Julienne Fritz, an NAIC staff member, discussed the status of SERFF (System for Electronic Rate and Form Filing), and its role of facilitating information between state and federal offices. She said the goal of having a common database for transmission between the parties cannot be completed until HHS publishes the rules.

A full-day discussion on SERFF on Thursday established that there is little consensus on what direction most states are going in, and that there is a lot of anxiety as regulators and insurance providers move forward.

Said one participant on Thursday after a breakout session, the only consensus that regulators and providers could come to is, “We are all scared spit-less.”