Author: Tom Entrikin | Posted: 14. July 2011 10:43
The Centers for Medicare and Medicaid Services (CMS) issued on July 11 a draft copy of proposed rules on state health insurance exchanges under the Affordable Care Act (ACA). The proposed rules are scheduled to be published officially in the Federal Register on July 15 with a 75 day period for public comments. The proposed rules are designed to implement provisions of the ACA which afford states flexibility in methods of facilitating access to affordable coverage for qualified individuals and small businesses in 2014.
State-based exchanges must be governmental entities or non-profit entities established by the state. They must be federally approved by January 1, 2013 to begin offering coverage through qualified health plans (QHPs) effective January 1, 2014. To obtain federal approval, the state must develop a detailed exchange plan and the exchange must pass a readiness assessment. Such federal approval may include conditional approval to accommodate further systems development and contracting activities in states that are making substantial progress. If the state will not be ready by these deadlines, the exchange may pass a readiness assessment later on, at least 12 months before its proposed initial effective dates of coverage, and develop a plan jointly with CMS to transition the state away from the federal exchanges that will be available on January 1, 2014 where state-based exchanges are not. The initial open enrollment period will be October 1, 2013 through February 28, 2014. Individuals for whom enrollment action is completed by December 22, 2013 will have coverage effective January 1, 2014.
Aside from these timeframes, many options are available to states in the governance, structure, and operations of the exchanges. The proposed rules say that states may participate in “regional” exchanges (exchanges serving two or more states, regardless of whether or not the states are contiguous). States may also establish “subsidiary” exchanges within their own states, if each such exchange serves a geographically distinct area over a minimum size. States may elect to authorize an exchange established by the state to enter into agreements with eligible organizations (including state Medicaid agencies and most private entities but not health insurance issuers) to carry out one or more required exchange functions. States may permit limited health insurance industry representation on governing boards subject to disclosure and conflict of interest standards. States may elect to permit insurance agents and brokers to enroll qualified individuals and employers into qualified health plans. The Small Business Health Options Program (SHOP) for qualified employers may be implemented through the same exchanges as programs for individual consumers, or separately under independent governance, at the state’s discretion. Pre-ACA state exchanges such as the highly successful Massachusetts Health Connector may be deemed to meet certain exchange requirements.
Exchanges will help consumers and small businesses make informed purchases of coverage through qualified health plans by launching websites through which consumers can examine standardized comparative information on competing plans, by maintaining toll-free call centers, by funding “navigators” (including local human services agencies but not health insurance issuers), and by accepting streamlined enrollment applications online, by mail, or in person. Other eligibility-related exchange functions include enrolling low income individuals in Medicaid and the Children’s Health Insurance Program (CHIP), determining advance tax credits and cost-sharing for moderate income individuals, offering an online “calculator” to help consumers determine their net costs for coverage under competing plans, certifying whether individuals are exempt from tax penalties for non-coverage under the “individual mandate”, generating enrollment and other required notifications, and offering appeals procedures on eligibility and enrollment actions. Premium payments may be handled through exchanges (at the state’s discretion subject to protocols ensuring integrity of financial transactions) or paid directly by purchasers to qualified health plans.
Additional exchange functions defined in the proposed rule include certifying qualified health plans (other than federally approved multi-state plans that may be deemed qualified), decertification procedures, evaluating quality improvement strategies, overseeing consumer satisfaction surveys, assessing and rating health plans, maintaining provider directories with information provided by the plans, determining the adequacy of provider networks, meeting reporting requirements, ensuring data privacy and security, and consulting with stakeholders. The proposed rules also cover corresponding requirements applicable to qualified health plans, such as coverage of “essential community providers”, compliance with network adequacy standards required by the exchanges, making provider directory information available to the exchanges, identifying primary care providers no longer accepting new patients, and sharing other information with exchanges that will help each individual and small business to make informed decisions among coverage options.
The proposed rules will likely be finalized over the next several months following CMS evaluation of public comments. Subjects to be addressed more specifically in separate CMS rule-making include standards for determining individual eligibility, procedures for issuing certificates of exemption from the “individual mandate” (a focus of on-going litigation closely monitored by Sam Fish), and definitions of the minimum “essential health benefits” that qualified health plans must cover.
