WASHINGTON – The federal government Friday gave tentative approval to New York’s efforts to set up a health insurance exchange where uninsured New Yorkers and small businesses will be able to shop for policies starting next October.

The state has met the benchmarks it needs to meet in setting up the exchange, officials at the Department of Health and Human Services said.

“New York has made significant progress, and in 10 months will be ready for open enrollment where New Yorkers will be able to purchase private health insurance plans,” said HHS Secretary Kathleen Sebelius.

The creation of the state health insurance exchange may mean little to New Yorkers who currently get health care through their employers, but it will mean a lot to the uninsured, said Chiquita Brooks-LaSure, director of coverage policy programs at the federal government’s Office of Health Reform.

“It will be a one-stop marketplace where people can find the health plan that meets their needs,” Brooks-LaSure said.

That’s something people will have to do starting in 2014 when, under the Obama health law passed in 2010, most Americans will be required to have health insurance.

New York will be ready when that day comes, said Donna Frescatore, executive director of the New York Health Benefit Exchange.

The exchange already has a website, And starting in January, the state will begin working with insurers that are interested in offering insurance policies on the exchange.

And starting on Oct. 1, 2013, individuals and small businesses will be able to start shopping for insurance on the exchange. In-person “navigators” will be available around the state next fall to help people navigate the exchange, Frescatore added.

New York is one of only 18 states that has opted to set up its own exchange.

“We want to make sure the exchange is well integrated with our public health insurance programs; we want it to be a seamless process,” Frescatore said. “We also wanted to make sure the exchange was designed to meet the needs of small businesses.”

New York has received $183 million in federal grants to set up its exchange.

In contrast, many states – particularly those with Republican governors – have instead opted to either let the federal government run such exchanges or have set up a federal-state partnership. Some states have worried that a state-run exchange eventually would be a costly burden on state taxpayers.

“If Virginians are faced with running a costly, heavily regulated bureaucratic exchange without clear direction from Washington, then it is in the best interest of our taxpayers to let Washington manage an exchange at this time,” Virginia Gov. Bob McDonnell said Friday in a letter to Sebelius.