Source: http://healthreformgps.org/resources/update-cms-faqs-on-exchanges-market-reforms-and-medicaid/
Timestamp: 2016-08-27 11:41:05
Document Index: 357079769

Matched Legal Cases: ['§1311', '§1311', '§2702', '§1311', '§1905', '§1311', '§155']

Update: CMS FAQs on Exchanges, Market Reforms and Medicaid – Health Reform GPS: Navigating the Implementation Process HealthReformGPS is made possible through generous financial support from the RCHN Community Health Foundation. Visit them at http://www.rchnfoundation.org/ HomeAbout
Update: CMS FAQs on Exchanges, Market Reforms and Medicaid
Posted on December 19, 2012 | No Comments Filed under Health Insurance, Implementation Briefs, Implementation Update, Medicaid and CHIP, Tax Policy
Key Developments Library Editor's Comment Implementation Briefs By Sara Rosenbaum
This Update summarizes the CMS Frequently Asked Questions (FAQ) document issued on December 10, 2012.
Exchanges and Market Reforms
Deadlines. CMS does not plan to further extend the deadlines for states to determine their level of involvement in implementing Exchanges. States that wish to operate a state-based exchange must notify the Department by December 14, 2012. States that wish to pursue a state partnership exchange may submit their letters and Blueprint Applications on a rolling basis and the HHS Secretary will similarly approve on a rolling basis. A Blueprint is due by February 15, 2012.
Application timelines. Grants to establish an Exchange and test their operations during 2014 will be awarded through 2014, and grants may be awarded until December 31, 2014 for approved establishment activities that fund first-year start-up activities. Grants are available for state Partnership exchanges, for state activities in connection with a Partnership. States will not be required to repay these funds as long as they are used for approved activities in the grant and cooperative agreement awards.
Charges for the use of the federal data hub. HHS will not impose charges on states for use of the federally-managed data services hub to support information exchange between Exchanges, Medicaid, and CHIP agencies and relevant federal agencies.
Partnership exchanges. By February 15, 2013, states must submit a declaration letter and the relevant portions of the Blueprint to receive approval or conditional approval. In a Partnership, the focus is on plan management and consumer activities.
Aligning FFEs with state law. “To the greatest extent possible,” HHS plans to work with states to “preserve the traditional responsibilities of state insurance departments.” HHS will “seek to harmonize Exchange policy with existing state programs and laws whenever possible.” HHS is “currently working to determine” the extent to which activities conducted by state insurance departments such as the review of rates and policy forms could be recognized as part of the certification of qualified health plans by a FFE.” HHS is working with the National Association of Insurance Commissioners (NAIC) to utilize the System for Electronic Rate and Form Filing (http://www.serff.com, operated by NAIC) as part of the QHP certification process. HHS will also collect Medicaid and CHIP state policy data.
Familiarity of FFE staff with state rules. FFE and State Partnership call center personnel and the website will provide information consistent with state law. Partnership states will oversee the Navigators program and may also provide additional outreach. Navigators will advise consumers, in a culturally and linguistically appropriate fashion, about QHPs, insurance affordability programs, and ombudsman help.
State enforcement powers. Where the enforcement of state insurance law is concerned, FFEs are limited to certifying and managing QHPs and will not engage in general state enforcement activities. These will remain the purview of state insurance departments. HHS will defer to states on matters of licensure and will also verify QHP compliance with federal certification standards.
Funding FFEs. FFEs will be funded by a 3.5 percent premium tax, although this number may be adjusted once final state-based Exchange financing decisions are made. Exchange user fees will support activities such as consumer outreach, information, and assistance activities. These funds are separate from grants states receive to build interfaces with the FFE or operate a Partnership.
State support for serving FFEs. Under “certain circumstances” HHS will use ACA funding for Exchange establishment (§1311) to fund state support activities such as developing a data system interface, coordinating the transfer of insurance licensure information, and other activities needed to support the FFE. HHS will continue this funding after §1311 funds are gone and will make FFE tools available to all state-based and Partnership exchanges.
How will market competition be promoted? HHS believes that the combination of subsidies, quality standards, and performance ratings will ensure quality and competition.
Final regulations. HHS intends to publish final regulations on essential health benefits early in 2013, as well as regulations on actuarial value and market reforms.
Benefit levels for EHBs. In order for a state EHB benchmark plan to satisfy the requirement that all EHBs be covered, states may choose from widely available products in their states and then supplement the benchmark in situations in which the state’s “base benchmark” (that is, the plan chosen as its benchmark starting point) “does not cover any items and services within an essential health benefits category.” Supplementation may be accomplished “by adding that particular category in its entirety from another base-benchmark plan option.” The resulting hybrid plan also would need to be adjusted so that it meets standards for non-discrimination and balance. HHS also will use a process to supplement a default plan in states that elect not to develop their own EHB benchmark. The agency will begin with the largest plan by enrollment in the second largest product in the state’s small group market. Supplementation would be drawn from the third largest product, the largest national plan by enrollment across states that is offered to federal employees, the largest pediatric vision and dental plans in the FEHBP market, and habilitative services as defined in the proposed EHB rules.
Multi-state plan compliance with state law and fair competition. OPM intends to use the same standards that apply to other QHPs. There are certain adjustments that OPM has proposed to the general QHP certification standards as part of its NPRM.
Can bridge plans serving both Medicaid/CHIP and Exchange populations – and limited to these populations — be certified under the ACA? An Exchange may allow Medicaid managed care organizations to offer a QHP as a bridge plan as long as the QHP offered by the MCO complies with all applicable laws governing QHPs. The plan may, without violating the ACA’s guaranteed issue requirements, specify that its enrollment is limited to individuals whose income moves them between Medicaid and the Exchange and may limit its network under §2702 of the Public Health Service Act to individuals and families whose subsidy basis changes. The contract also would need to bar cost shifting from the non-Medicaid to the Medicaid population. In order for a bridge plan to operate, the plan must sign a legally binding contractual agreement to serve the crossover population. Individuals who enroll in a bridge plan also must not be “disadvantaged in terms of the buying power of their advance premium tax credits.” CMS indicates that additional guidance is forthcoming and that the states in which bridge plans are the most viable are those that operate their own exchanges.
Pre-Existing Condition Insurance Plan and Other High Risk Pools
“Generally,” the pre-existing condition insurance pool will not exist past 2014, since the transitional reinsurance program should stabilize the transition of persons enrolled in high risk pools into Exchanges. However, HHS is now considering ways to enable states to continue their pools
HHS plans to issue guidance, but no date is specified.
HHS places a “high priorit[y]” on consumer outreach through the Navigator program, in-person assistance, and call centers. States and stakeholders “definitely” will have input.
FFEs will offer Navigator programs. Consistent with the ACA, at least one of the FFE Navigators selected will be “a community and consumer-focused non-profit group.” A Navigator Grant Funding Opportunity will be issued in early 2013. States cannot require Navigators to hold a producer [agent or broker] license. Navigators will be required to go through federal training if they are operating in an FFE, whether wholly federally administered or a state Partnership. States may impose Navigator specific licensing and certification requirements so long as the requirements do not include a producer license.
States operating in state Partnership Exchanges will be expected to build and operate an in-person assistance program, which is distinct from the Navigator program, and for which funding is available under §1311. The emphasis is on multiple tools.
HHS is developing an online and paper single application that permits enrollment in QHPs, Medicaid plans, and CHIP plans. The single application will also support all insurance affordability programs. HHS sought comments in a July 2012 notice and is going through consumer testing. The final version is expected in early 2013 and HHS will also work with states that desire to develop their own applications.
Consumers who are denied assistance under any insurance affordability program will have the option to pay full price for a QHP and will receive timely written notices containing appeals rights.
A special HHS-administered system will determine shared responsibility exemptions and transmit the results of the determination back to state-based Exchanges, which will then notify individuals who seek exemptions. Exchanges will also notify individuals of their obligation to report changed circumstances that might affect the exemption. HHS intends to “shortly” issue more information on the exemption process, including applications and transfers.
In FFEs, qualified individuals will be able to view and purchase QHPs. However, if individuals are Medicaid or CHIP-eligible, QHP purchase will not be permitted.
There is no deadline for states to make a Medicaid expansion determination; a state’s Medicaid decision is independent of its decision regarding whether to operate an Exchange or apply for a state Partnership with the FFE. In early 2013 HHS will go operational with an online plan amendment system.
States will have flexibility to start or stop their expansions, although the enhanced FMAP rates are fixed by statute (100% in 2014-2016, 95% in 2017, 94% in 2018, 93% in 2019, and 90% in 2020 and thereafter).
States will not be permitted to partially implement the expansion group but must cover all individuals described in the group in order to receive the enhanced FMAP. States may seek partial expansion demonstrations, but if approved, demonstrations would receive only the normal FMAP. Beginning in 2017, HHS may consider alternatives to the full Medicaid expansion, when federal funding begins to drop “slightly,” as part of an Innovation Waiver application that states may wish to submit.
The Administration no longer supports a blended FMAP proposal as part of the federal budget, particularly given the Supreme Court’s decision, which ties the enhanced FMAP to the new eligibility category as a “new program.”
The Court’s decision affects only the eligibility expansion. Therefore, all other Medicaid amendments in the ACA that relate to the Medicaid/Exchange interaction and enrollment simplification are fully in effect. Exchanges will make either an eligibility determination or an eligibility assessment, depending on a state’s choice.
In order to help states address added costs and administrative burdens associated with Medicaid eligibility expansion, 90% federal matching funds are available for new and improved eligibility systems capable of making MAGI determinations. HHS will be sharing system build information as well as business rules related to MAGI determinations. HHS also will “continue exploring opportunities” to provide states with additional support for the administrative costs of eligibility changes. Online applications, data-based eligibility rules, verification and renewal procedures, and the new federally-managed data services hub will also help defray state costs. The existence of one data hub will ease state verification procedures. Furthermore, in FFE states, the Exchange can, at state option, perform Medicaid eligibility determinations. Special 90/10 and 75/25 federal match rates remain available through 2015 for system modernization, and these enhanced rates are not contingent on adoption of the eligibility expansion.
Individuals with incomes at 100% FPL who apply for coverage through state Exchanges in non-Medicaid expansion states will face premiums and cost sharing.
States will receive the “highest matching rate possible” for the enrolled population. Thus, expansion states that implemented expansions before the 2014 effective date will receive the highest match to which they are entitled as of January, 2014. Thus, a state that expanded to all adults up to 100% FPL prior to January 2014 would receive the full enhanced rate for populations with incomes between 100 and 133%. Similarly, states that offered less than full benchmark benefits to the expansion population prior to January 2014 will receive enhanced match for the population, since the benefit design has changed. Finally, states that funded coverage for low income adults out of state funding prior to January 2014 will qualify for the full enhanced match since the population is considered newly eligible for Medicaid.
HHS welcomes input from states on how to make Medicaid administration more flexible through uses of waiver authority, learning collaboratives, model testing and other approaches.
HHS will consider Medicaid expansion approaches that emphasize personal responsibility for health and the promotion of healthy behaviors. HHS is exploring options and “invite[s] states to continue to come to us with their ideas, including those that promote value and individual ownership in health care decisions as well as accountability tied to improvement in health outcomes.”
The MAGI conversion is required by law and applies regardless of whether states adopt the eligibility expansion for low income adults.
HHS is preparing to issue a new methodology for Medicaid DSH payments. It is not clear how the new methodology may interact with state decisions not to implement the Medicaid reforms. Nor does HHS indicate whether states that reduce their uninsured by expanding Medicaid eligibility will lose DSH funding to other states.
Coordination between Exchanges and other programs
States will be able to offer coverage through the same coverage source even in the case of families with different family members receiving different forms of affordability assistance (Medicaid, CHIP, premium tax credits). States can use Medicaid and CHIP funds to support the purchase of employer-sponsored assistance (although some wraparound assistance may be required in the case of employer-sponsored plans that impose higher cost sharing and lower benefit levels).
In addition, states can use their Medicaid and CHIP funds to buy coverage for children whose parents are enrolled in a QHP with premium assistance, assuming that the QHP participates. This is because both Medicaid and CHIP (SSA §§1905(a) and 2105(c)(3)) permit funds to be used to purchase “group health plans and, under some authorities, for health plans in the individual market, which, in 2014, would include qualified health plans available through the Exchange.”
The ACA envisions a coordinated system for making eligibility determinations across insurance affordability programs in order to foster continuity of care. Smooth eligibility transitions cannot wholly alleviate the issue; continuity will also depend “on whether and to what degree plans participate in both the Exchange and in Medicaid and CHIP, and the networks in such plans.” Premium assistance can help address this issue while “encouraging robust plan participation in Medicaid, CHIP, and the Exchange.” Rather than enrolling individuals in a Medicaid MCO, a state would use its premium assistance authority to buy enrollment in a QHP; this option may be most attractive for families with incomes close to the upper Medicaid limit. A premium assistance model would also be subject to Medicaid ‘wraparound’ requirements for Medicaid eligible persons for whom the state has bought QHP enrollment.
Conflicts in state and federal law harmonization. What is the process for resolving conflicts in federal and state law harmonization in the case of FFEs? Will state insurance standards that are inconsistent with QHP certification standards simply be modified by HHS if a conflict exists with federal laws (for example, an issuer licensure standard that conflicts with a federal market reform standard)? Will HHS notify a state of the inconsistency and enter into a negotiation process? If so, how will the process operate? Who may initiate the process? Who would arbitrate the process? Will the results of the federal harmonization review process be made public?
Non-discrimination and balance. HHS notes that in building an EHB benchmark, states must adjust their “base” plans to cover all 10 EHB classes and to satisfy standards for non-discrimination and balance. The proposed EHB regulations, however, do not define discrimination beyond repeating the prohibition in the statute. What types of coverage practices will HHS consider to amount to discrimination or the lack of balance?
Bridge plans. Will FFEs certify bridge plans if recognized by a state Medicaid and CHIP programs and appropriately licensed by the state Department of Insurance?
Basic Health Plan. Will guidance be forthcoming in time for states to introduce a basic health plan into their insurance markets prior to the January 1, 2014, effective date for coverage to begin?
Single streamlined application. In what languages will the application be available? What accommodations will be made for persons with visual impairments?
Individual responsibility exemptions. Will HHS notify the IRS that exemptions have been granted?
Medicaid eligibility “assessments”. The FAQ restates the March 2012 regulation permitting states to opt for “assessments” of Medicaid eligibility rather than “enrollment” by Exchanges as required by the ACA itself. Will more information on how the assessment process works be forthcoming?
Individual responsibility and Medicaid beneficiaries. Will HHS allow demonstrations that allow states to utilize premiums or higher cost-sharing in their Medicaid programs in order to promote personal responsibility, similar to the approaches now sanctioned by the ACA’s wellness program exception to the non-discrimination rule? Will HHS consider augmented benefit design to allow states to fund health promotion activities also recognized under the wellness program exception, such as YMCA membership?
Using Medicaid as premium support for QHP enrollment. Will CMS issue additional guidance on the use of Medicaid for QHP premium support, on how the Medicaid payment rate will be determined, and on how Medicaid in a premium support role, will align with the ACA’s actuarial valuation provisions for QHPs?
February 27, 2014 The Centers for Medicare and Medicaid Services (CMS) issued the funding allocation for disproportionate share hospitals (DSH) for FY 2014. DSH payments are typically provided to hospitals that treat a disproportionate number of uninsured or under-insured patients. The Affordable Care Act (ACA) originally called for a cut in DSH payments, as more Americans would presumably be insured under Medicaid. The Supreme Court ruling that made Medicaid expansion optional, however, ultimately coerced CMS to delay DSH cuts for two years. CMS releases final DSH rule for safety net hospitals
September 13, 2013 In a final rule released today, the Centers for Medicare and Medicaid Services (CMS) stated that hospitals treating large low-income populations will begin to see a decline in their Disproportionate Share Hospital (DSH) payments. Typically, DSH payments are provided to hospitals that treat many uninsured and low-income populations as a means to offset some of the costs of rendering uncompensated care. DSH payments were set to decrease under the Affordable Care Act (ACA), as the individual mandate and expanded Medicaid eligibility requirements should have reduced the uninsured population. The Supreme Court ruling that state Medicaid expansion is optional hampered this goal, and a CMS fact sheet on the rule claimed that a state's decision on whether or not to expand Medicaid will not influence the allotment of DSH payment hospitals in that state will receive. In total, CMS will cut $1.1 billion in DSH payments over the next two years. CMS releases DSH payment proposed rule
May 14, 2013 The Centers for Medicare and Medicaid Services (CMS) released a proposed rule concerning reductions to Disproportionate Share Hospital (DSH) payments. Pursuant to the Affordable Care Act (ACA), the federal government had intended to cut DSH payments beginning in 2014, as the law's Medicaid expansion would negate the need for such payments. Since the Supreme Court's decision rendered Medicaid expansion optional, the federal government has elected to delay the DSH payment reduction until 2015 when they have a more accurate assessment of the nation's uncompensated care level after initial implementation of the ACA.
A fact sheet summarizing the rule can be found here. HHS releases shorter Exchange enrollment application forms
April 30, 2013 In response to the comments received on the length and complexity of the 21-page health insurance application draft, the US Department of Health and Human Services (HHS) has shaved down the application and released their second iteration this morning. Under the Affordable Care Act's (ACA) individual mandate, most Americans are required to have insurance by January 1st, 2014. The new application released by HHS is designed to make the enrollment process more streamlined and simple. Individuals wishing to enroll into the Exchange will submit a 5-page document entitled "Application for Health Coverage and Help Paying Costs (Short Form)." The family application, "Application for Health Coverage and Help Paying Costs" comes in at 12-pages in length. HHS has also provided a 5-page application titled "Application for Health Coverage" for anyone wishing to enter the Exchange, but is unsure of their eligibility. CRS issues report on DSH payments
December 9, 2013 The Congressional Research Service (CRS) recently published a report about Medicaid disproportionate share hospital (DSH) payments. Since FY1993, DSH payments have been provided to hospitals that serve a high proportion of both uninsured and underinsured patients. Care provided to these patients is often uncompensated or compensated at low rates, rendering DSH payments necessary to help mitigate some of the financial strain associated with treating this patient population. The Affordable Care Act (ACA) was designed to help reduce the uninsured population, and as a result, a provision to reduce DSH payments was included in the law. The 2012 Supreme Court ruling, which made Medicaid expansion optional for states, did not change the DSH payment reduction provision. The final rule outlining the DSH reduction methodology does not take into account a state's decision on Medicaid expansion, so some states may experience a reduction in DSH payments without the intended accompanied increase in insured individuals. The new CRS report provides an overview of DSH payments, including allocation methodology, current trends in DSH spending, and implications on states after full implementation of the ACA. Update: Ohio expands Medicaid
October 22, 2013 After the measure to expand Medicaid failed in the Legislature this summer, the Ohio Controlling Board voted 5-2 to approve Medicaid expansion under the Affordable Care Act (ACA). This decision, which will likely be met by a multitude of legal challenges in the coming months, makes Ohio the 25th state to accept enhanced federal funding to help insure the state's most impoverished residents. Our map has been updated to reflect these changes. Tavenner answers Senate Finance Committee Questions
April 25, 2013 On April 9th, the Senate Finance Committee held a confirmation hearing for Marilyn Tavenner to be the Administrator of the Centers for Medicare and Medicaid Services (CMS). Committee members submitted additional questions to Tavenner post-hearing on topics ranging from consumer outreach in state insurance Exchanges to pediatric dental services. Health Reform GPS has compiled a list of the Affordable Care Act related questions submitted by the Senate Finance Committee members. The list contains the name of the Senator asking the question, the question number, and the relevant ACA topic addressed. Medicaid Expansion and Health Insurance Marketplaces: One Map that Tells the Whole Story
September 17, 2013 As full implementation is poised to begin, GPS staff have prepared a map designed to provide a status update in one visual. The map blends Medicaid and Marketplace information to present a more comprehensive view of states’ role in implementation, as the extent of their engagement in two central elements of the law, the Medicaid expansion and the establishment of Marketplaces.
The 16 states in blue are... Medicare and Medicaid Disproportionate Share Hospital Payments: Proposed Rules
June 13, 2013 For thirty years, the Medicare and Medicaid programs have furnished additional payments to hospitals that furnish a disproportionate share of services to low income populations. Despite the fact that the two disproportionate share hospital (DSH) programs share a common mission, they function differently in terms of how the funds actually move to hospitals and in the formulas used to make DSH payments. The Affordable Care Act makes significant adjustments in both DSH programs beginning in 2014 in anticipation of a significant expansion in the proportion of people who have health insurance coverage. With the United States Supreme Court’s decision in 2012 in NFIB v Sebelius, which permits states to opt out of the Medicaid expansion without risking the loss of federal funding for their existing Medicaid programs, the downward DSH payment adjustments become an even more significant matter for hospitals that treat large volumes of low income patients... Navigators and Application Counseling and Assistance
April 24, 2013 The ACA (§§1311(d) and (i)) and implementing regulations (45 C.F.R. §155.210) require that all Exchanges establish Navigator programs to provide fair, accurate and impartial information regarding health insurance coverage across Exchanges and state Medicaid and CHIP programs. Navigators also facilitate selection of QHPs and provide referrals for consumers with questions, complaints, or grievances to other consumer assistance and ombudsman programs. The Navigator program requirement applies regardless of whether the Exchange is operated by a state government or by the federal government (known as a “federally-facilitated Exchange”), either with or without a state Consumer Assistance Partnership... Stay Connected
Chronic Disease Management posted on February 23, 2011 Section 1557 of the ACA and Non-Discrimination: The HHS Request for Information posted on August 12, 2013 Essential Community Providers posted on March 11, 2011 Center for Medicare and Medicaid Innovation posted on May 13, 2010 State Health Insurance Exchange Navigators posted on February 28, 2011 Categories