U.S. GOVERNMENT PUBLISHING OFFICE

WASHINGTON : 

1 

79–010 

" ! SENATE 115TH CONGRESS

2d Session 

REPORT

2018

115–277 

Calendar No. 468 

REPEAL INSURANCE PLANS OF THE 

MULTI-STATE PROGRAM ACT OF 2017 

R E P O R T 

OF THE

COMMITTEE ON HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

WITH ADDITIONAL VIEWS 

TO ACCOMPANY

S. 2221 

TO REPEAL THE MULTI-STATE PLAN PROGRAM 

JUNE 18, 2018.—Ordered to be printed 


congress.#13
(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

RON JOHNSON, Wisconsin, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

JAMES LANKFORD, Oklahoma 

MICHAEL B. ENZI, Wyoming 

JOHN HOEVEN, North Dakota 

STEVE DAINES, Montana 

CLAIRE MCCASKILL, Missouri 

THOMAS R. CARPER, Delaware 

HEIDI HEITKAMP, North Dakota 

GARY C. PETERS, Michigan 

MAGGIE HASSAN, New Hampshire 

KAMALA D. HARRIS, California 

DOUG JONES, Alabama 

CHRISTOPHER R. HIXON, Staff Director 

GABRIELLE D’ADAMO SINGER, Chief Counsel 

JOSHUA P. MCLEOD, Professional Staff Member 

MARGARET E. DAUM, Minority Staff Director 

STACIA M. CARDILLE, Minority Chief Counsel 

CHARLES A. MOSKOWITZ, Minority Senior Legislative Counsel 

THOMAS J.R. RICHARDS, Minority Professional Staff Member 

LAURA W. KILBRIDE, Chief Clerk 

Calendar No. 468 

115TH CONGRESS REPORT " ! SENATE 2d Session 115–277 

REPEAL INSURANCE PLANS OF THE MULTI-STATE 

PROGRAM ACT OF 2017 

JUNE 18, 2018.—Ordered to be printed 

Mr. JOHNSON, from the Committee on Homeland Security and 

Governmental Affairs, submitted the following 

R E P O R T 

together with 

ADDITIONAL VIEWS 

[To accompany S. 2221] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Homeland Security and Governmental Affairs, 

to which was referred the bill (S. 2221) to repeal the multi-State 

plan program, having considered the same, reports favorably thereon with an amendment in the nature of a substitute and recommends that the bill, as amended, do pass. 

CONTENTS 

Page 

I. Purpose and Summary .................................................................................. 1 

II. Background and Need for the Legislation ................................................... 2 

III. Legislative History ......................................................................................... 6 

IV. Section-by-Section Analysis .......................................................................... 7 

V. Evaluation of Regulatory Impact .................................................................. 7 

VI. Congressional Budget Office Cost Estimate ................................................ 7 

VII. Additional Views ............................................................................................ 9 

VIII. Changes in Existing Law Made by the Bill, as Reported ........................... 14 

I. PURPOSE AND SUMMARY

S. 2221, the Repeal Insurance Plans of the Multi-State Program 

Act, or the RIP MSP Act, repeals the Multi-State Plan (MSP) ProVerDate Sep 11 2014 06:54 Jun 27, 2018 Jkt 079010 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\SR277.XXX SR277
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1Patient Protection and Affordable Care Act, Pub. L. No. 111–148, 124 Stat. 119 (2010); see also H.R. 3590—Patient Protection and Affordable Care Act, Congress.gov, https:// 

www.congress.gov/bill/111th-congress/house-bill/3590/all-actions (last updated Mar. 23, 2010). 2 U.S. Off. of Pers. Mgmt., A New Day for Federal Service: An Overview of the Multi-State 

Plan Program (2014), https://marketplace.cms.gov/technical-assistance-resources/multistate-planprogram.pdf; see also Robert Moffit, Will This Little-Known Obamacare Provision Lead to a Public Option?, Daily Signal (Jan. 15, 2015), http://dailysignal.com/2015/01/15/will-little-knownobamacare-provision-lead-public-option. 3Patient Protection and Affordable Care Act § 1334. 

4Moffit, supra note 2. 5See Robert Moffit, Dan Blair & Linda Springer, The Office of Personnel Management: A 

Power Player in America’s Health Insurance Markets?, Heritage Found. (Feb. 19, 2010), https:// 

www.heritage.org/health-care-reform/report/the-office-personnel-management-power-playeramericas-health-insurance. 6Sarah Kliff, No, The Public Option is Not Back From the Dead, Wash. Post: Wonkblog (Oct. 

30, 2012), https://www.washingtonpost.com/news/wonk/wp/2012/10/30/no-the-public-option-hasnot-returned-from-the-dead/?utm_term=.f7fddd750b03. 7Timothy Noah, Medicare Buy-in, RIP, Slate: Public Option Wiki (Dec. 14, 2009), http:// 

www.slate.com/articles/news_and_politics/prescriptions/2009/12/public_option_wiki.html. 8Kliff, supra note 6. 

gram authorized under Section 1334 of the Patient Protection and 

Affordable Care Act (ACA). The MSP Program is not meeting statutory requirements under the ACA and eliminating this program 

will allow the Office of Personnel Management (OPM) to focus on 

mission-critical programs. 

II. BACKGROUND AND THE NEED FOR LEGISLATION

On March 23, 2010, President Barack Obama signed the ACA 

into law.1 The MSP Program mandated by the ACA was intended 

to increase competition and provide greater insurance choices for 

consumers.2 To accomplish this task, Section 1334 authorized the 

Director of OPM to contract with health insurers to offer at least 

two multi-state plans on state exchanges for individual or group 

coverage, thereby competing against other plans offered through 

the exchanges.3 Section 1334 required issuers to be licensed in each 

state and subject to all the requirements of state law while complying with minimum standards established under chapter 89 of 

title 5, United States Code, as well as any other requirements as 

determined by the Director. OPM was granted a phase-in period for 

the multi-state plans with coverage of 60 percent of the states in 

the first year, 70 percent of states in the second year, 85 percent 

of states in the third year, and all states in each subsequent years. 

Section 1334 was inserted into the ACA by former Senate Majority Leader Harry Reid during floor consideration after the legislation passed the Senate Finance Committee.4 Due to its late addition, there was little debate on the merits of creating the MSP program or whether it could meet the stated objective of offering increased competition and more choice.5 Politico reported on the 

rushed origins of the program, stating things happened so fast that 

there was little time for a robust, thoughtful conversation.6

News that some members of Congress were nearing an agreement to create the MSP Program became public in December 2009 

when Majority Leader Reid announced that a health reform working group of ten senators had arrived at a ‘‘tentative consensus 

‘that includes a public option.’ ’’ 7 The working group Majority Leader Reid referenced explored several reform options before settling 

on the MSP Program. One proposal under discussion by the working group was a public option; however a public option in which the 

government acted directly as the issuer did not have enough support to pass through Congress.8 As a result, Senator Chuck SchuVerDate Sep 11 2014 06:54 Jun 27, 2018 Jkt 079010 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\SR277.XXX SR277
3 

9 Id. 10 Id. 11 Id. 12 Id. 13 Rachana Pradhan & Paul Demko, Another Piece of Obamacare Falls Short, Politico (Sept. 

7, 2016), http://www.politico.com/story/2016/09/obamacare-falls-short-227854. 14S. Rep. No. 111–89 (2009); see also Sabrina Corlette, The Multi-State Plans Unveiled, Geo. 

U. Ctr. On Health Ins. Reforms Blog (Sept. 30, 2013), http://chirblog.org/multi-state-plans-unveiled/. 15Patient Protection and Affordable Care Act § 1334. 16 Id. 17Patient Protection and Affordable Care Act § 1334; see also U.S. Off. of Pers. Mgmt., supra 

note 2; U.S. Off. of Pers. Mgmt., Multi-State Plan Program and the Health Insurance Marketplace: FAQs, https://www.opm.gov/healthcare-insurance/multi-state-plan-program/consumer/ 

?page=1#url=FAQs (last visited Apr. 4, 2018). 18S. Rep. No. 111–89 (2009); see also Corlette, supra note 13. 19 Christine Monahan, Oh Where, Oh Where Are The Multi-State Plans?, Geo. U. Ctr. On 

Health Ins. Reforms Blog (June 6, 2013), http://chirblog.org/oh-where-oh-where-are-the-multistate-plans/; see also Sarah Goodell, The Multi-State Plan Program (Updated), Health Affairs 

(May 29, 2014), https://www.healthaffairs.org/do/10.1377/hpb20140529.10243/full/. 20 Robert Pear, U.S. Plans to Unveil New Insurance Options, N.Y. Times (Sept. 29, 2013), 

https://www.nytimes.com/2013/09/30/us/politics/us-plans-to-unveil-new-insurance-options.html?mcubz=0. 21Document productions from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland 

Sec. & Governmental Aff. (Oct. 6, 2017 and Feb. 13, 2018) (on file with S. Comm. on Homeland 

Sec. & Governmental Aff.). 

mer (D–N.Y.) worked with nine of his colleagues to come up with 

a backup plan to the public option.9 One alternative under consideration by the working group was the MSP Program through which 

OPM would work with private insurers to offer health insurance 

plans to compete with other plans available on state exchanges.10

Another alternative was allowing individuals over the age of 55 to 

enroll in Medicare.11 It was reported that key senators withheld 

support for the second idea, leaving the MSP Program all that remained.12 With a public option in which the government played the 

role of insurer off the table, the MSP Program was added to the 

ACA as the public option backup plan, described by some as a ‘‘sort 

of a catch-all for a lot of different ideas.’’ 13

THE MSP PROGRAM IS FAILING TO INCREASE COMPETITION AND

CHOICE

The MSP Program was created to increase both competition and 

choice in state health care exchanges.14 Section 1334 of the ACA 

requires the availability of two MSP plans in all 50 states by 

2017.15 Additionally, the law requires OPM to contract with at 

least one non-profit provider, and to ensure that at least one MSP 

option does not provide abortion coverage.16 However, only one 

issuer association—the Blue Cross Blue Shield Association 

(BCBSA)—has ever participated in the MSP Program.17 BCBSA already had a significant market share in the states that previously 

participated in the MSP Program,18 and has approximately 70 percent of the market share in the one remaining state participating.19

In the 2014 plan year, OPM contracted with one group of issuers 

to offer more than 150 MSP options in 31 states, including the District of Columbia. The Obama Administration ‘‘told insurers to assume that each national plan would have 750,000 people enrolled 

in the first year.’’ 20 However, approximately 350,000 individuals 

enrolled in an MSP option in 2014. For plan year 2015, MSP coverage expanded to 36 states and 437,000 individuals.21 For plan 

year 2016, MSP covered approximately 375,000 individuals in 33 

states, and in 2017 the MSP enrollment fell to 290,000 individuals 

4 

22 Id. 23Majority Cmte. staff call with Arkansas State Insurance Department (Feb. 2, 2018). 24Letter from Douglas W. Elmendorf, Dir., Cong. Budget Off., to Harry Reid, Majority Leader, 

U.S. Senate (Dec. 19, 2009), http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/108xx/ 

doc10868/12-19-reid_letter_managers_correction_noted.pdf. 25 Id. 26 Id. 27 Cong. Budget Off., Congressional Budget Office Cost Estimate: S. 2221 Repeal Insurance 

Plans of the Multi-State Program Act of 2017 (2018), https://www.cbo.gov/publication/53621. 28 Id. 29 Id. 

in 22 states.22 By 2018, only one state—Arkansas—covering approximately 55,000 individuals was participating in the MSP Program.23

Five years after its implementation in 2014, the MSP Program 

is both failing to fulfill program intent and to meet statutory requirements. In regard to the statutory requirement that all 50 

states and the District of Columbia participate in the MSP Program, with only one state participating, the program has a state 

participation success rate of 1.9 percent. 

A possible lack of issuer participation was a concern foreshadowed by the Congressional Budget Office (CBO). Shortly prior 

to passage of the ACA, CBO questioned the utility of the MSP Program and whether issuers would participate.24 In a 2009 letter to 

Majority Leader Reid, CBO wrote: 

[w]hether insurers would be interested in offering [MSP] 

plans is unclear, and establishing a nationwide plan comprising only nonprofit insurers might be particularly difficult. Even if such plans were arranged, the insurers offering them would probably have participated in the insurance exchanges anyway, so the inclusion of this provision 

did not have a significant effect on the estimates of federal 

costs or enrollment in the exchanges.25

At the time, CBO also estimated that the creation of the MSP 

Program was ‘‘unlikely to have much effect on average insurance 

premiums because the existence of that public plan would not substantially change the average premiums that would be paid in the 

exchanges.’’ 26

In evaluating the merits of this legislation, CBO found that 

eliminating MSPs would not affect Federal subsidies for health insurance purchased through the marketplaces.27 CBO also found 

that MSPs are not the lowest-cost or second-lowest cost silver plans 

in any rating areas where they are offered.28 Because of this, CBO 

confirmed: 

[d]ata from HHS on enrollment in and premiums for 

MSPs over a longer-period of time show that those plans 

serve a small and declining percentage of people who purchase coverage through the marketplaces. CBO and the 

staff of the Joint Committee on Taxation do not expect 

that eliminating such plans would affect the level of competition in or average premiums for marketplace coverage 

in future years.29

5 

30 E-mail from U.S. Off. of Pers. Mgmt. Staff to S. Comm. on Homeland Sec. & Governmental 

Aff. Majority Staff (on file with S. Comm. on Homeland Sec. & Governmental Aff.). 31 Our Mission, Role & History, U.S. Off. of Pers. Mgmt., https://www.opm.gov/about-us/ourmission-role-history/ (last visited Apr. 4, 2018). 32 U.S. Off. of Pers. Mgmt., Congressional Budget Justification: Fiscal Year 2018 2 (2017), 

https://www.opm.gov/about-us/budget-performance/budgets/congressional-budget-justificationfy2018.pdf. 33Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. 

& Governmental Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental 

Aff.). 34 Id. 35For example, as of Dec. 31, 2017, OPM had an inventory of 14,515 unprocessed retirement 

claims. See Michael O’Connell, OPM Cuts Retirement Backlog to its Lowest Level in More Than 

a Year, Fed. News Radio (Jan. 5, 2018), https://federalnewsradio.com/retirement/2018/01/opmcuts-retirement-backlog-to-its-lowest-level-in-more-than-a-year/; see also U.S. Off. of Pers. Mgmt. 

Statistical Abstracts: Fiscal Year 2016 (2017). 36 U.S. Off. of Pers. Mgmt., Congressional Budget Justification: Fiscal Year 2018 2 (2017), 

https://www.opm.gov/about-us/budget-performance/budgets/congressional-budget-justificationfy2018.pdf. 37Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. 

& Governmental Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental 

Aff.). 38Majority Cmte. staff call with Arkansas State Insurance Department (Feb. 2, 2018). 39See Kirstin B. Blom & Ada S. Cornell, Cong. Res. Serv., R43922, Federal Employees Health 

Benefits (FEHB) Program: An Overview (2016), https://fas.org/sgp/crs/misc/R43922.pdf. 

THE MSP PROGRAM DIVERTS OPM FROM MISSION-CRITICAL PROGRAMS THAT SERVE THE FEDERAL WORKFORCE AND ITS RETIREES

OPM supports passage of S. 2221, noting that ‘‘[r]epealing this 

statutory requirement would allow OPM to further strengthen its 

capacity to meet the important needs of our benefit programs serving the 2.7 million employees of the Federal workforce and over 2 

million Federal workforce retirees.’’ 30

Since 1978, OPM’s core mission has been to serve the Federal 

workforce and its retirees.31 The creation of the MSP Program diverted OPM’s focus from this mission by requiring OPM to begin 

providing non-Federal services for the American public.32 From fiscal year (FY) 2011 to FY 2017, OPM spent $54 million in ‘‘salaries 

and expenses’’ to administer the MSP Program.33 This funding supported 42 full-time equivalents in FY 2017 alone.34

These additional resources were requested for the MSP Program 

in the annual Congressional Budget Justification instead of being 

requested for mission-critical programs that serve the Federal 

workforce and its retirees. Diverting OPM resources away from its 

core mission is significant given that the agency is currently struggling to provide acceptable levels of service to Federal employees.35

For instance, in FY 2017, OPM requested $3.35 million less money 

to support processing of its backlog of Federal retirement claims.36

At the same time, OPM expended $10.3 million for MSP Program 

salaries and expenses alone.37

S. 2221 will allow OPM to focus exclusively on mission-critical 

programs that benefit current members of the Federal workforce, 

tribes and tribal organizations and retirees. 

Lastly, the volume of staff devoted to the program is disproportionate to the volume of people served. In 2018, 42 employees will 

serve no more than 55,000 participants in Arkansas.38 The Federal 

Employee Health Benefits Program (FEHBP), by comparison, has 

117 full-time employees but serves 8.2 million people.39 Therefore, 

throughout most of the program’s existence, OPM has dedicated 

only 3.3 employees per 100,000 FEHBP enrollees while dedicating 

14 employees per 100,000 MSP enrollees. 

6 

40 U.S. Off. of Pers. Mgmt. briefing, majority staff (Nov. 20, 2017). See also Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. & Governmental 

Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental Aff.). 41Memorandum from Norbert E. Vint, Deputy Inspector Gen., U.S. Off. of Pers. Mgmt., Off. 

of Inspector Gen., to Beth F. Cobert, Acting Dir., U.S. Off. of Pers. Mgmt. (Dec. 8, 2016), https:// 

www.opm.gov/our-inspector-general/reports/2016/management-alert-status-of-the-multi-stateplan-program-4a-hi-00–17–013.pdf. 42 U.S. Off. of Pers. Mgmt. Off. of Inspector Gen., Top Management Challenges: Fiscal Year 

2017 (2017), https://www.opm.gov/our-inspector-general/special-reports-and-reviews/fy2017-topmanagement-challenges.pdf; see also Memorandum from Norbert E. Vint, Deputy Inspector 

Gen., U.S. Off. of Pers. Mgmt., Off. of Inspector Gen. to Beth F. Cobert, Acting Dir., U.S. Off. 

of Pers. Mgmt. (Oct. 12, 2016), https://www.opm.gov/our-inspector-general/special-reports-and-reviews/fy2016-management-challenges.pdf. 

In 2018, OPM has been working to right-size its workforce. However, prior to the reorganization, OPM requested in its FY 2018 

congressional budget justification to support 72 full time employees—which would have been an increase over the 42 full time employees that served the program in FY 2014.40 Following the reorganization that began on April 1, 2018, OPM is currently working 

to reduce the volume of Federal employees working on the MSP 

Program by redirecting staff from the MSP Program to missioncritical programs such as TRICARE and FEDVIP. 

In addition to the MSP Program detracting from OPM’s missioncritical programs, the program continues to be a concern for the 

OPM Office of Inspector General (OIG). In December 2016, the OIG 

issued a Management Alert for the program due to a lack of participation on the part of states and providers, and confusion about 

the name incorrectly signaling coverage would cross state boundaries when MSP coverage does not.41 In FYs 2016 and 2017, the 

OIG also included the program in its list of top management challenges facing the agency.42 S. 2221 will allow OPM to focus exclusively on mission-critical programs. 

III. LEGISLATIVE HISTORY

S. 2221, the RIP MSP Act, was introduced on December 12, 2017, 

by Chairman Ron Johnson (R–WI). The bill was referred to the 

Committee on Homeland Security and Governmental Affairs. On 

April 25, 2018, Senator Lamar Alexander was added as a cosponsor. On May 24, 2018, Senator James Risch joined as a cosponsor. 

On June 12, 2018, Senators Rand Paul, John McCain, and Steve 

Daines were added as cosponsors. 

On June 8, 2018, the National Active and Retired Federal Employees Association (NARFE) expressed NARFE’s support for S. 

2221 ‘‘in order to redirect staff and budgetary resources from the 

Multi-State Plan (MSP) Program to the Office of Personnel Management’s (OPM) core missions.’’ 

The Committee considered S. 2221 at a February 14, 2018 business meeting. A substitute amendment offered by Chairman Johnson extended from October 1, 2018 to January 1, 2019 the date by 

which the MSP Program would end to align with the 2019 plan 

year. The substitute amendment also removed a rescission of unused funds, and a related Sense of Congress, to ensure Federal 

funds remain in OPM’s control for authorized functions. The substitute amendment was adopted by unanimous consent. 

The Committee ordered S. 2221, as amended, reported favorably, 

by a roll call vote of 10 ‘‘yeas’’ to 3 ‘‘nays.’’ Senators voting in the 

affirmative were Senators Johnson, Portman, Paul, Lankford, Enzi, 

Hoeven, Daines, McCaskill, Heitkamp, and Jones. Senators voting 

7 

in the negative were Senators Peters, Hassan, and Harris. For the 

record only, Senator McCain voted ‘‘yea’’ by proxy and Senator Carper voted ‘‘nay’’ by proxy. 

IV. SECTION-BY-SECTION ANALYSIS OF THE BILL, AS REPORTED

Section 1. Short title 

This section establishes the short title of the bill as the ‘‘Repeal 

Insurance Plans of the Multi-State Program Act’’ or the ‘‘RIP MSP 

Act.’’ 

Section 2. Repeal of Multi-State Plan Program 

This section repeals section 1134, the Multi-State Plan Program 

of the Patient Protection and Affordable Care Act (Public Law 111– 

148), effective January 1, 2019. It requires the OPM Director to 

brief the Committee on Homeland Security and Governmental Affairs in the Senate and the Committee on Oversight and Government Reform in the House of Representatives not later than 60 

days after the legislation is enacted. The briefing must include information concerning how OPM and MSP issuers are notifying current enrollees that there will no longer be MSP options available; 

a description of how the OPM Director will work with the Secretary of Health and Human Services to ensure no MSP plans are 

made available; and a timeline detailing how OPM will close the 

information technology portal that MSP issuers utilize. 

V. EVALUATION OF REGULATORY IMPACT

Pursuant to the requirements of paragraph 11(b) of rule XXVI of 

the Standing Rules of the Senate, the Committee has considered 

the regulatory impact of this bill and determined that the bill will 

have no regulatory impact within the meaning of the rules. The 

Committee agrees with the Congressional Budget Office’s statement that the bill contains no intergovernmental or private-sector 

mandates as defined in the Unfunded Mandates Reform Act and 

would impose no costs on state, local, or tribal governments. 

VI. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, Washington, DC, February 27, 2018. 

Hon. RON JOHNSON, Chairman, 

Committee on Homeland Security and Governmental Affairs, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2221, the Repeal Insurance 

Plans of the Multi-State Program Act of 2017. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Alice Burns. 

Sincerely, 

KEITH HALL, 

Director. 

Enclosure. 

8 

1Silver plans cover about 70 percent of the costs of covered benefits for people at most income 

levels. 

S. 2221—Repeal Insurance Plans of the Multi-State Program Act of 

2017 

S. 2221 would repeal Section 1334 of the Affordable Care Act 

(ACA), eliminating multi-state plans (MSPs) offered through marketplaces established by the ACA. Under current law, the Office of 

Personnel Management (OPM) contracts with private insurers to 

offer MSPs; those plans may operate in one or more states. The repeal would be effective January 1, 2019. Within 60 days of enactment, the bill also would require OPM to brief the Senate Committee on Homeland Security and Governmental Affairs and the 

House Committee on Oversight and Government Reform on OPM’s 

efforts to wind-down the program. 

OPM reports that in 2018 Arkansas Blue Cross and Blue Shield 

is the only insurer to offer MSPs and such plans are only available 

in Arkansas. Premium data from the Department of Health and 

Human Services (HHS) show that MSPs are not the lowest-cost or 

second-lowest cost silver plans in any rating areas where they are 

offered.1 Because premiums for silver plans with the second-lowestcost are the basis for calculating federal subsidies for health insurance purchased through the marketplaces, eliminating plans with 

premiums higher than those second-lowest cost plans would not affect subsidies. 

Data from HHS on enrollment in and premiums for MSPs over 

a longer-period of time show that those plans serve a small and declining percentage of people who purchase coverage through the 

marketplaces. CBO and the staff of the Joint Committee on Taxation do not expect that eliminating such plans would affect the 

level of competition in or average premiums for marketplace coverage in future years. Thus, implementing S. 2221 would not have 

a significant effect on the federal budget. 

The bill would not affect direct spending or revenues; therefore, 

pay-as-you-go procedures do not apply. 

CBO estimates that enacting S. 2221 would not increase net direct spending or on-budget deficits in any of the four consecutive 

10-year periods beginning in 2028. 

S. 2221 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act. 

The CBO staff contact for this estimate is Alice Burns. The estimate was approved by Leo Lex, Deputy Assistant Director for 

Budget Analysis. 

(9) 

1 Congressional Budget Office, S. 2221, Repeal Insurance Plans of the Multi-State Program Act 

of 2017 Cost Estimate (Feb. 2018) (www.cbo.gov/system/files/115th-congress-2017-2018/ 

costestimate/s2221.pdf). 2Pub. L. No. 111–148 (2010). 

3Office of Personnel Management, Patient Protection and Affordable Care Act, Establishment 

of the Multi-State Plan Program for the Affordable Insurance Exchanges, 77 Fed. Reg. 72581 

(Dec. 5, 2012) (proposed rule). 4S. 2221, 115th Cong. (2017). 

VII. ADDITIONAL VIEWS 

ADDITIONAL VIEWS OF SENATORS CLAIRE MCCASKILL, 

HEIDI HEITKAMP, AND DOUG JONES 

While the undersigned supported passage of S. 2221, the Repeal 

Insurance Plans of the Multi-State Program Act, during Committee 

consideration, our support was based on a recognition that the Office of Personnel Management (OPM) does not have the authorities 

needed to bring competition and choice into the health insurance 

marketplace, as is required by statute, and the Administration requests that the agency no longer be required to administer the program. We do not support the justification by the Majority that a 

lack of hearings, poor vetting of the policy proposal, and a misalignment of mission led to the failure of the Multi-State Plan program (MSPP). Further, we disagree that there was a diversion of 

resources from other insurance programs that lead to any 

unfulfilled mission-requirements based on administration of the 

MSPP. Lastly, the Senate Finance Committee and Senate Health, 

Education, Labor, and Pensions Committee have the legislative jurisdiction to stabilize the health insurance marketplace and fix the 

Affordable Care Act. They are better suited than the Senate Homeland Security and Governmental Affairs Committee to address the 

challenges of consumer choice, plan competition, high premium 

costs, and general market stabilization. 

As the Congressional Budget Office (CBO) report for S. 2221 

states, neither CBO nor the Joint Committee on Taxation ‘‘expect 

that eliminating such plans would affect the level of competition in 

or average premiums for marketplace coverage in future years.’’ 1

BACKGROUND

Section 1334 of the Affordable Care Act (ACA) created the 

MSPP.2 This provision of the law required the Director of the Office of Personnel Management (OPM) to contract with health insurers to ‘‘foster competition among plans competing in the individual 

and small group health insurance markets.’’ 3 S. 2221 would stop 

Section 1334 from having any force or effect of law effective October 1, 2018, but the bill would not repeal Section 1334, as is stated 

in its title.4

The process by which this provision was included in the bill is 

typical of the Senate floor amendment process. The provision was 

10 

5S. Amdt. 3276 to H.R. 3590 (December 19, 2009). 

6Senators seek to put OPM in charge of health care public option, Government Executive (Dec. 

5, 2009) (www.govexec.com/federal-news/2009/12/senators-seek-to-put-opm-in-charge-of-healthcare-public-option/30472/); See also, OPM could get role running national health plan, Government Executive (Dec. 6, 2009) (www.govexec.com/pay-benefits/2009/12/opm-could-get-role-running-national-health-plan/30473/). 7OPM could get role running national health plan, Government Executive (Dec. 6, 2009) 

(www.govexec.com/pay-benefits/2009/12/opm-could-get-role-running-national-health-plan/30473/). 8Sabrina Corlette, Action on Multi-State Plans, But Still No Specifics, CHIR (blog) (July 27, 

2012) (www.chirblog.org/actiononmultistateplans/). 9Sarah Goodell, The Multi-State Plan Program (Updated) Health Policy Brief, Health Affairs 

(May 29, 2014). 10Office of Personnel Management, Congressional Budget Justification Fiscal Year 2019 (Feb. 

2018). 11Sabrina Corlette, Action on Multi-State Plans, But Still No Specifics, CHIR (blog) (July 27, 

2012) (www.chirblog.org/actiononmultistateplans/); Letter from Consumer Representatives to Office of Personnel Management (Aug. 21, 2015); Comments from National Association of Insurance Commissioners to Office of Personnel Management’s request for information regarding 

Multi-State Plan Nationwide Insurance Plans (Aug. 10, 2011). 12 45 CFR § 800.101. 

included as part of a Manager’s Amendment filed by Senator Harry 

Reid on December 19, 2009, during floor consideration and debate 

of the ACA.5 The provision directing OPM to create the MSPP was 

devised by a bipartisan group of 10 Senators, and originally proposed by Senator Olympia Snowe (R–ME) as an alternative to the 

public option.6 The provision then became thought of as another 

way to interject competition and choice into the health insurance 

exchanges ‘‘modeled after the federal employee benefits program.’’ 7

Senators believed OPM could leverage its contract negotiations experience from running the Federal Employee Health Benefits Program (FEHBP) for 50 years to help drive competition and choice in 

marketplace Exchanges.8 In addition, the provision was thought to 

offer plans that would cross State lines and avoid individual State 

regulations, similar to the FEHBP National Plan options, which 

would help keep premiums low and increase plan choices.9

To imply that the failure of MSPP was related to the process by 

which it was included in the final bill is misleading and disingenuous. By that logic, any changes made to a bill after the Committee 

process, any amendment offered on the Floor of the Senate, or any 

bill passed without a hearing would raise similar concerns and 

should be repealed for lack of thorough vetting. 

The FEHBP is a market-based employer-sponsored health insurance program that establishes its own rules and regulations for insurance issuers to participate in the program, and is not subject to 

State licensing and insurance requirements. OPM uses its preemption authority of State requirements to ‘‘deliver quality health care 

services to FEHBP Program members while controlling the costs of 

premium increases.’’ 10

In the debate around implementation of the MSPP, the paramount concern for consumer advocates and State health insurance 

commissioners was whether the authority in Section 1334 meant 

OPM could preempt State requirements and deem plans eligible to 

participate on the exchanges.11 In response to these concerns and 

comments received during the regulatory process, the final rule 

published by OPM required issuers who chose to participate in the 

MSPP to comply with State law.12

When the health insurance marketplace exchanges were stood-up 

in 2013 for the 2014 plan year, OPM had contracted with one 

group of issuers, Blue Cross and Blue Shield, to offer more than 

11 

13Office of Personnel Management, Patient Protection and Affordable Care Act; Establishment 

of the Multi-State Plan Program for the Affordable Insurance Exchanges, 80 Fed. Reg. 9649 

(Mar. 26, 2015) (final rule). 14Office of Personnel Management, Congressional Budget Justification Fiscal Year 2016 (Feb. 

2015). 15Office of Personnel Management, Congressional Budget Justification Fiscal Year 2017 (Feb. 

2016). 16Memorandum from Norbert Vint, Deputy Inspector General, to Beth Cobert, Acting Director, Management Alert—Status of the Multi-State Plan Program (Dec. 8, 2016). 

150 plan options in 31 States and the District of Columbia. Approximately 350,000 individuals enrolled in a multi-State plan in 

2014. Multi-State plan coverage expanded in 2015 to include 

437,000 individuals in 36 States and the District of Columbia. In 

plan year 2016, the ability of OPM to attract more issuers and expand options to more States became a significant challenge, and 

only 375,000 individuals in 33 States and the District of Columbia 

enrolled in plans. This problem was exacerbated in 2017 where enrollment fell to 290,000 individuals in 22 States, and in plan year 

2018, only 55,000 individuals in one State—Arkansas—are covered 

by the multi-State plans.13

OPM planned to expand insurance options in the MSPP to 44 

States in 2016,14 and targeted a goal of more than 505,000 individuals to be covered by the multi-State plan options in 2017.15 However, these goals were never met as OPM struggled to attract new 

issuers, offer more plan options, and cover more individuals. As the 

OPM Office of the Inspector General (OIG) noted in a December 

2016 Management Alert, 

‘‘The MSP Program is experiencing a reduction in the 

number of options offered by MSP Issuers. We expect this 

to continue until the market stabilizes . . . OPM’s National Healthcare Operations is doing the best that it can 

to retain and attract MSP issuers and state-level issuers 

into the program. However, the program is voluntary and 

the Affordable Care Act does not provide OPM with flexibilities, such as allowing the MSP Program to establish requirements that are consistent across all states, that can 

be used to attract and incentivize participation in the program. Legislative changes would be required to allow for 

such flexibilities.’’ 16

OPM agreed with the OIG Management Alert and noted that it 

continues to struggle to attract insurers to participate in the 

MSPP. OPM stated in its fiscal year 2018 Congressional Budget 

Justification that, 

‘‘[T]he statute does not authorize the preemption of state 

law requirements governing health insurance. This lack of 

preemption capability is a significant difference between 

the [MSP] and the FEHBP. These statutory changes have 

been amplified by the volatility of the individual and small 

group health insurance markets, which has caused a number of issuers to cease offering products on the Health Insurance Exchanges.’’ 

12 

17Pub. L. No. 111–148 (2010). 18Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. 

& Governmental Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental 

Aff.). 19Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. 

& Governmental Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental 

Aff.). 20Office of Personnel Management, Congressional Budget Justification Fiscal Year 2013 (Feb. 

2012); Office of Personnel Management, Congressional Budget Justification Fiscal Year 2014 

(Feb. 2013); Office of Personnel Management, Congressional Budget Justification Fiscal Year 

2015 (Feb. 2014); Office of Personnel Management, Congressional Budget Justification Fiscal 

Year 2016 (Feb. 2015); Office of Personnel Management, Congressional Budget Justification Fiscal Year 2017 (Feb. 2016); Office of Personnel Management, Congressional Budget Justification 

Fiscal Year 2018 (Mar. 2017); and Office of Personnel Management, Congressional Budget Justification Fiscal Year 2019 (Feb. 2018). 21Document production from U.S. Off. of Pers. Mgmt. provided to S. Comm. on Homeland Sec. 

& Governmental Aff. (Oct. 6, 2017) (on file with S. Comm. on Homeland Sec. & Governmental 

Aff.). 

RESOURCES

One concern raised during the consideration of the MSPP was 

the impact of the new requirement on the existing insurance benefit programs at the Office of Personnel Management. In particular, concerns were raised about the resource allocation and 

interplay between the new MSPP and the existing FEHBP. Section 

1334 addressed this issue directly in subsection (g), which— 

• prohibited OPM from allocating fewer financial or personnel resources to the administration of the FEHBP; 

• required the MSPP to have a separate risk pool from the 

FEHBP; 

• authorized creation of a separate program office for the 

MSPP; 

• required the Director to separate resources in the program 

administration between the MSPP and FEHBP; and 

• prohibited any requirement for FEHPB plans to participate in the MSPP.17

OPM stood up the MSPP using funds appropriated to the Department of Health and Human Services (HHS) for Affordable Care Act 

implementation.18 OPM used the $5 million transferred from HHS 

between fiscal years 2011 and 2013 to carry-out the requirements 

of the ACA and establish the MSPP.19 Since the Program went into 

effect, OPM has allocated resources through its discretionary salaries and expenses appropriations, while the remainder of OPM’s insurance program funding comes through appropriations limitations 

of Trust Fund transfers for administrative expenses.20 It is misleading to suggest diversion of resources from other insurance programs lead to any unfulfilled mission-requirements. 

In fiscal year 2018, OPM spent $10.3 million to administer the 

MSPP.21 In the absence of the requirement for OPM to implement 

the MSPP, these discretionary funds could be used for other purposes such as information technology modernization or administration of other insurance programs. However, given that the funds 

are discretionary, elimination of the program could also mean that 

the salaries and expenses discretionary funding is reduced by a corresponding figure in future year appropriations. There is no guarantee that the repeal of the requirement for OPM to administer the 

MSPP will divert financial resources to other programs, and may 

13 

22Letter from Douglas W. Elmendorf, Dir., Cong. Budget Off., to Harry Reid, Majority Leader, 

U.S. Senate (Dec. 19, 2009), http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/108xx/ 

doc10868/12-19-reid_letter_managers_correction_noted.pdf. 23Office of Personnel Management, Agency Financial Report Fiscal Year 2017 (Nov. 2017); 

Memorandum from Norbert Vint, Office of Personnel Management Deputy Inspector General, 

to Beth Cobert, Acting Director, Management Alert—Status of the Multi-State Plan Program 

(Dec. 8, 2016). 

require OPM to attrite personnel resources in the absence of funding for those personnel. 

CONCLUSION

The goal of the MSPP was to inject competition and choice into 

the health insurance marketplace and as the CBO noted in 2009, 

this provision did not have a significant effect on budget estimates 

because OPM was not granted the kind of authority it needed to 

do so.22 OPM and the OPM Inspector General noted in various 

budget and management documents that the destabilization of the 

health insurance marketplace further led to the lack of efficacy in 

the MSPP.23

In the absence of Congress and the Administration strengthening 

the Affordable Care Act, it is the view of the Minority that OPM 

should not be statutorily obligated to run this program. Furthermore, given ongoing efforts to destabilize the health insurance markets, it is the jurisdictions of the Senate Finance Committee and 

the Senate Health, Education, Labor, and Pensions Committee to 

address issues of healthcare market competition, choice, and stabilization not the Senate Homeland Security and Governmental Affairs Committee. 

14 

VIII. CHANGES IN EXISTING LAW MADE BY THE BILLS, AS REPORTED

Because S. 2221 would not repeal or amend any provision of current law, it would make no changes in existing law within the 

meaning of clauses (a) and (b) of paragraph 12 of rule XXVI of the 

Standing Rules of the Senate. 

Æ